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Introduction to statutory interpretation The aim of statutory interpretation is to determine the legal meaning of a statute, that is, the sense that expresses the legislator’s intention. The clearest guide to that intention is the statutory wording itself, read in its context and with its overall purpose in mind, and its broader legislative setting. Courts should seek to fulfil the purpose of legislation by construing its language, so far as they can, in the manner that most effectively serves that purpose. Put differently, the courts’ default method is purposive, and every enactment is to be construed with that end in view. There is a starting presumption that the grammatical and ordinary sense of an enactment reflects the meaning intended by the legislator. Where an enactment reasonably bears only a single meaning, and no other interpretative tools or
This Practice Note addresses identifying a fiduciary, fiduciary duties and obligations, the no conflict rule, the no profit rule, a fiduciary's duty of confidence, and the remedies available for breach of fiduciary duty. Who is a fiduciary? There is no definitive catalogue of relationships that give rise to fiduciary obligations at common law in every situation universally. Certain relationships are inherently fiduciary, eg trustee and beneficiary, solicitor and client, principal and agent, business partner and co-partners, together with mortgagor and mortgagee. The obligations of some fiduciaries have been set out in statute; for instance, trustees owe a statutory duty of skill and care under section 1 of the Trustee Act 2000 (TrA 2000), and directors' relationships with their companies are addressed in the Companies Act 2006 too. For guidance on directors' fiduciary duties, see Practice Note: of directors for further detailed
Definition of ADR Alternative dispute resolution (ADR) is defined in the CPR Glossary as a collective label for methods of settling disputes other than through the usual trial process. Some courts adopt the term ‘negotiated dispute resolution’ (NDR) to describe resolution by alternative means; for ease, this Practice Note uses ADR. For guidance on how ADR is addressed in the various court guides, see Practice Note: ADR and NDR in the court guides. In essence, ADR is a means of resolving a dispute outside the court system. It typically involves a neutral third party who either helps the parties reach a negotiated outcome, or issues a determination of the dispute that is legally binding. A binding result can follow where the agreement to refer the dispute to ADR so provides. There are multiple forms of ADR processes. For an outline of the different types and their
In brief The British constitution is uncodified, meaning it does not spring from a single constitutional document or code. It draws on a wide range of written and unwritten sources. Alongside the principal written sources of law in England and Wales—legislation (which has also introduced international and human rights principles into our constitution) and the common law—the constitution also rests on two further unwritten bases within this system: the prerogative, and non-legal constitutional conventions. In addition, on one view the basic or prevailing principle of our constitution, Parliamentary sovereignty, is ultimately grounded in political fact rather than in law. Legislation Legislation is the foremost source of constitutional law. Acts of Parliament may set out detailed constitutional rules, or even pass authority to create them to ministers or to others. Under the doctrine of Parliamentary sovereignty, legislation is traditionally regarded as taking precedence over any other form or kind of
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This Resource Note collates commentary, analysis and sources to aid interpretation of, and give practical guidance on the application of, UKLR 8 of the UK Listing Rules, which addresses requirements for companies in the equity shares (commercial companies) category—also known as the commercial companies category—in relation to related party transactions ( RPT)... Where relevant, it signposts: the Financial Conduct Authority ( FCA) Handbook FCA guidance in its Knowledge Base— Procedural notes and Technical notes (which constitute formal guidance and are binding on the FCA) FCA consultation papers ( CP), discussion papers ( DP), policy statements ( PS) and feedback statements Primary Market Bulletins and other publications of the FCA former UKLA technical and procedural notes and the UKLA’s newsletter List!, where still relevant to the interpretation or application of a provision assimilated EU...
This Practice Note considers when VAT zero-rating applies to developers who sell or let non-residential properties they have transformed for residential use—either as dwellings or for a relevant residential purpose. Why does zero-rating matter? If zero-rating is unavailable, the supply is generally exempt and the developer is unable to reclaim VAT (ie input tax) on costs, for example on the building’s conversion, professional fees and possibly on buying the property. For further guidance, see Practice Note: When can a person recover VAT? VAT cannot be reclaimed if it ought not to have been charged. Put simply, VAT charged in error is not reclaimable. Care is therefore required throughout projects. Where the project creates a dwelling, the conversion services are commonly taxed at 5%, or are zero-rated where a housing association commissions the work (see Practice Note: VAT treatment of building work). A 20% VAT claim may be...
This Practice Note explains the zero-rating of VAT for developers who sell or let dwellings they have built Why does zero-rating matter? Without zero-rating, the supply is typically exempt, meaning the developer is unable to reclaim VAT (ie input tax) on related expenditure, for example on professional fees and potentially on the site acquisition. For more details, see Practice Note: When can a person recover VAT? The building services provided during the construction of the dwelling will, in most cases, already have been zero-rated; see Practice Note: VAT treatment of building work. Where that is so, a developer who did not suffer VAT on buying the site may view zero-rating of sales and leases as advantageous, though not strictly necessary Why might zero-rating not apply? ......
For UK VAT to be chargeable, a transaction must satisfy five cumulative criteria. Specifically, it must: amount to a supply of goods or a supply of services constitute a taxable supply occur in the UK be made by a taxable person be carried out in the course or furtherance of any business operated by that person This Practice Note explains what each of those five requirements means. It does not, however, consider the importation of goods or those cases where a UK customer is obliged to account for UK VAT on services received from abroad—ie, the reverse charge; for those topics, see Practice Notes: VAT—the reverse charge on cross-border supplies and VAT—importing goods. This Practice Note also includes references to EU Directives and case law; for details on the continuing significance of EU Directives, and of judgments of the Court of...
Universities and other academic institutions Universities and other academic bodies carry out extensive research and consequently create significant volumes of protectable IP. Safeguarding and exploiting this IP is both costly and time‑consuming, and frequently the university is better placed to manage this than individual academics. Many larger institutions operate IP policies requiring academics to assign all IP rights arising from their research to the university. In return, incentives such as a share of the income generated by the IP are provided. After a university secures ownership of IP, it can be commercialised in several ways, including: donation for the wider benefit of the public licensing to established third parties or start‑ups selling or assigning the IP to third parties creating spin‑offs to exploit the IP A university ‘spin‑off’ or ‘spin‑out’ is a new company established to capitalise on research...
Article 11 of the Organisation for Economic Co-operation and Development ( OECD)'s model tax convention ( MTC) is concerned with the taxation of interest paid cross border. It specifically addresses how taxing authority is divided between: the state of residence of the person receiving the payment (the recipient state), and the state of residence of the person making the payment (the source state) This Practice Note examines: the meaning of ‘interest’ in a double tax treaty or convention ( DTT) context the model convention approach to the taxation of interest targeted anti-treaty shopping provisions variations on this approach in DTTs, and the practical contexts in which an assessment of the interest article will arise The EU Interest and Royalties Directive, which exempts from withholding tax all interest payments between associated companies of different Member States, and which was...
FORTHCOMING CHANGE relating to UK transfer pricing legislation: On 29 April 2025, the UK government released draft legislation for technical consultation setting out a series of proposed revisions to the UK transfer pricing framework, together with related amendments to the rules on permanent establishment and the diverted profits tax. Headline measures include: the withdrawal of UK-to- UK transfer pricing, save for targeted exceptions designed to deter tax arbitrage; changes to the participation condition; and a range of updates to provisions that regulate financial transactions. The draft text follows the Conservative government’s initial policy consultation on reform launched in 2023, and the Labour government’s Autumn Budget 2024 announcement of further consultations. A further consultation, also launched on 29 April 2025, proposes limiting the current SME exemption to small enterprises only, and introducing a new filing obligation for...
This Practice Note This Practice Note examines the eligibility criteria concerning money and investments for a Tier 1 ( Investor) migrant seeking indefinite leave to remain, where their most recent leave was granted under the pre-6 November 2014 Immigration Rules for the route and the application is made before 6 April 2022. It sets out which investments qualify (including any pertinent restrictions), how qualifying investments must be maintained, and the documentation required to confirm that the qualifying investments and, where applicable, any balancing funds have been maintained across the relevant specified continuous period. It should be considered alongside Practice Note: Tier 1 ( Investor): applying for indefinite leave to remain. As this route was closed to any further initial applications on 17 February 2022, by Statement of Changes in Immigration Rules CP 632, partly due to concerns that it enabled the transfer of...
Trustees and personal representatives can, in fact, carry on a trade. For example, where a self-employed trader dies, the personal representative may keep the business running until it is wound down or sold. In the same way, trustees or interest in possession beneficiaries might be trading and could qualify for reliefs such as roll-over relief or business asset disposal relief. The broad tax rules governing trading apply to all traders alike, whether they are individuals, trustees, or personal representatives. This Practice Note sets out those principles below. Is there a trade? The key issue to examine is whether there is a trade. At times this will be clear, for instance when personal representatives step in to continue the deceased’s business; however, in other situations even a solitary transaction can amount to a trade. As an illustration, trustees who buy a property to renovate may,...
Abolition of the remittance basis and introduction of a residence-based IHT regime from 6 April 2025 The Finance Act 2025 ( FA 2025), which secured Royal Assent on 20 March 2025, enacts the abolition of the remittance basis and introduces a residence-based system from 6 April 2025. FA 2025 also removes domicile as the principal test for inheritance tax liability. Additional reforms revise the rules for excluded property status, scrap the protected settlements status of offshore trusts, and alter the overseas workday relief provisions. For further detail on these measures, see Practice Notes: The abolition of the remittance basis of taxation from 2025–26 and A new residence-based regime for IHT from 2025–26. Significance of settlor’s domicile for offshore trusts A trust’s exposure to UK income tax and capital gains tax ( CGT) is governed by the residence of its trustees. In some...
This Practice Note The UK government has long aimed to make the country one of the world’s most appealing places for innovation and enterprise. To achieve this, it has introduced a range of tax incentives that support innovative companies and their investors, spanning every stage of a business’s life cycle. These include: R& D tax reliefs the patent box business asset disposal relief (formerly entrepreneurs’ relief) amortisation deductions for companies acquiring intellectual property capital allowances for purchases of: knowhow patents plant and machinery venture capital trusts enterprise investment scheme seed enterprise investment scheme This Practice Note outlines the UK perspective on key tax considerations when deciding how to structure an...
ARCHIVED: This Practice Note has been archived and is not maintained. During the coronavirus ( COVID-19) outbreak, the UK government brought in a range of measures to assist individuals and businesses negatively affected by the pandemic. Several measures involved funds paid directly by central or local government with no requirement to repay, ie grants rather than loans. For further details on these schemes, see Practice Note: Coronavirus ( COVID-19)—tax implications [ Archived]. Guidance on these schemes stated that recipients should recognise such grants as taxable income, as they effectively substituted business income that would otherwise have been earned. On 29 May 2020, the government released draft legislation, a tax information and impact note, and explanatory notes for consultation. This was ultimately enacted as section 106 and Schedule 16 to the Finance Act 2020 ( FA 2020). The legislation’s purposes were: to treat...
This Practice Note This Practice Note explains the typical scope of a UK tax opinion prepared by tax lawyers for a UK tax resident securitisation company participating in an asset-backed securitisation ( ABS, sometimes called a true sale securitisation). In essence, an ABS is a structure in which a company (the originator) converts value by selling its assets to an orphan special purpose vehicle ( SPV) to generate cash. The SPV finances that purchase by issuing listed notes to investors, and the assets supporting the securitisation are referred to as securitised assets... A distinct corporation tax regime applies to entities that meet the criteria below: Qualify as securitisation companies; and Meet two further conditions: The unallowable purposes test; and The payments condition This regime is...
When a sole trader, or a person carrying on a business as a partner, opts to incorporate, the assets of that enterprise are moved into a, generally, newly created company. This movement amounts to a transfer, disposal or supply for VAT, capital gains tax, income tax, stamp duty land tax ( SDLT) and capital allowances purposes, and may result in a tax liability for the individual effecting the transfer at that time in respect of the assets transferred......
The way consideration payable for the acquisition of shares is structured is not always straightforward. In many transactions, how the consideration payable for a share purchase is arranged is far from simple. Quite often, payment is postponed, deferred or made conditional upon the satisfaction of specified contingencies. The structure and timing of such payments are therefore rarely straightforward. Most of the time, this reflects the buyer’s desire to: be satisfied that, when the deal completes, the company is in fact worth what the buyer believes it is worth at that point in time In such circumstances, sale agreements commonly include a price adjustment mechanism, typically calculated by reference to a set of accounts that are prepared as at the completion date. Any further sum payable (or any repayment due) is only settled once those accounts have been prepared, finalised and agreed, which can be several months after...
Rule 30— Setting the scene This Resource Note summarises the core provisions of Rule 30 of The City Code on Takeovers and Mergers ( Code), which governs the circulation of documents, announcements and information during an offer. It signposts pertinent material, commentary and guidance from the Panel, together with Lexis+® UK analysis and resources, to provide practical direction on the interpretation and application of Rule 30... Materials included Practice Statements issued by the Panel Executive (the body responsible for the day-to-day supervision and regulation of takeovers) ( Executive), offering informal guidance on how the Executive typically reads and applies the Code Panel Statements ( P/ S) and Panel Instruments Public Consultation Papers ( PCP) and Response Statements ( RS) from the Code Committee Annual Reports from the Panel discussing overarching issues ( Annual Reports) relevant Lexis+® UK...
This Resource Note sets out the principal provisions of Rule 12 of The City Code on Takeovers and Mergers (the Code). It signposts materials, commentary and guidance from the Panel on Takeovers and Mergers ( Panel), together with Lexis+® UK analysis and resources, to offer practical guidance on interpreting and applying Rule 12. Materials addressed in this Resource Note include: the detailed notes to the Code ( Notes), which explain the intended implementation of the Rules, and the relevant Appendices covering specific matters Panel Statements ( P/ S) and Panel Instruments published by the Panel Public Consultation Papers ( PCP) and Response Statements ( RS) issued by the Code Committee relevant Lexis+® UK resources 2021 changes to Code In March 2021, the Panel confirmed it would proceed with amendments to the Code concerning the treatment of offer conditions and the offer timetable. For firm offers announced before 5 July 2021, Rule 12.1...
This Practice Note sets out details on the durations and conditions linked to entry clearance and permission to stay for individuals on the Student route, including those holding Student permission under the Doctorate Extension Scheme. New applications to the Doctorate Extension Scheme closed on 1 July 2021. Student union sabbatical officers fall outside the scope of this Practice Note. See also Practice Note: Student: eligibility, which explains the points-based and non points-based eligibility requirements for entry clearance and permission to stay applications under the Student route. Grant of permission Student permission is issued for the length of the course, with additional periods before commencement and after completion. The table below sets out the time allowed prior to the course start date and following the course end date, as recorded on the student’s confirmation of acceptance for studies ( CAS)......
Duties and powers Harbour authorities A harbour authority is an independent, autonomous, self-governing body with responsibility for the safe management and efficient running of a harbour. In most circumstances, harbours are administered and run by statutory harbour authorities ( SHAs), empowered and governed by local legislation that is generally tailored to the specific requirements of the harbour in question. Different legislation sets out various, differing definitions. Under section 313(1) of the Merchant Shipping Act 1995 ( MSA 1995), a ‘harbour authority’, in relation to a harbour, covers all persons entrusted with the function of constructing, improving, managing, regulating, maintaining or lighting a harbour: the person who is the statutory harbour authority for the harbour; or if there is no statutory harbour authority for the harbour, the person (if any) who is the proprietor of the harbour, or who is entrusted with the function of...
STOP PRESS: The Economic Crime and Corporate Transparency Act 2023 ( ECCTA 2023) received Royal Assent on 26 October 2023. Designed to bolster corporate transparency in the UK, the Act chiefly delivers reforms to Companies House and changes to provisions within the Companies Act 2006. It also intends to update the regulatory landscape for limited partnerships and confer stronger powers to address economic crime. ECCTA 2023 will be rolled out in phases. A number of its measures took effect on 4 March 2024 and may have a bearing on this content. For more information, see Practice Notes: Implementation of the Economic Crime and Corporate Transparency Act 2023 and The Economic Crime and Corporate Transparency Act 2023—tracker, notably the legislation and consultation tracker. Rules and guidance The statutory requirements governing the annual accounts of small LLPs are contained in: Part 15 of the Companies Act 2006 ( CA...
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When evaluating a general damages claim, the practitioner ought initially to refer to the Judicial College Guidelines (JCG)...
This Practice Note This Practice Note reviews mechanisms used in settling litigation. A Tomlin order consists of a consent order paired with a schedule. It operates to stay proceedings on terms that have been agreed. The provisions contained in the schedule may remain confidential. This Practice Note describes the scope of confidentiality attaching to the schedule and sets out how it differs from a standard consent order. Sample wording for a Tomlin order is included, alongside links to precedents, as well as guidance on court approval. It also addresses varying, setting aside and enforcing a Tomlin order, including the considerations the court will take into account when handling applications for each. Further guidance is provided on interpreting and applying the relevant provisions of the CPR; however, some courts and divisions impose very specific requirements for both drafting and approval, and for approaching the schedule and confidentiality issues. Accordingly, you must consider the particular rules and court guide provisions in the forum where your claim is proceeding when drawing up the Tomlin order...
Date [ date ] Parties [ name of Landlord ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Landlord) [ name of Tenant ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Tenant) [ [ name of Guarantor ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Guarantor) ] [ [ name of Mortgagee ] [ of OR incorporated in England and Wales (company registration number [ number ]) with its registered office at ] [ address ] (Mortgagee) ] Definitions Within this Deed, the terms below shall be interpreted as follows: [ Annual Rent • the annual sum reserved under the Lease; ] [ Insurance Rent • the Tenant’s share of the Landlord’s costs of insuring the Property (as set out in the Lease); ] Lease • the lease of the Property dated [ date ], entered into between (1) [ the Landlord OR [ name ...
I, [ name ], of [ address ], solemnly and sincerely state that: [ Matters to be verified, set out in numbered paragraphs ] I make this solemn statement in good conscience, believing it to be true, and pursuant to the provisions of the Statutory Declarations Act 1835. DECLARED at [ details ] this [ day ] day of [ month and year ] Before me ................................................................................ [ signature of the person before whom the declaration is made ] A [ commissioner for oaths OR [ solicitor OR [ insert other qualification ] ] authorised to administer oaths ]...
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