Legal Practice Notes

As fireworks are explosives, the UK imposes stringent controls on their sale, possession and use, set out in the Explosives Act 1875 ( EA 1875), the Fireworks Act 2003 ( Fi A 2003), the Fireworks Regulations 2004, SI 2004/1836, and the Explosives Regulations 2014, SI 2014/1638. Separate strict requirements govern how fireworks are placed on the market, including notification, categorisation, labelling, UK marking ( CE marking pre- IP completion day), traceability and safety information duties, setting out what must be provided and when. These are contained in the Pyrotechnic Articles ( Safety) Regulations 2015 ( PASR 2015), SI 2015/1553, which detail the applicable framework. The Product Safety and Metrology etc. ( Amendment etc) ( EU Exit) Regulations 2019, SI 2019/696, amended PASR 2015, SI 2015/1553 to swap references to CE marking for UKCA marking, and to replace mutual recognition of...

Termination—contractual and common law rights As commercial solicitors, we are commonly engaged to advise on setting up a commercial relationship. While we, much like family practitioners preparing pre-nuptial agreements, often consider the consequences of a relationship ending, only in more recent economic conditions are we more frequently asked how to unwind the relationship in the first place. It is vital to remember that a right to terminate may arise at common law (for example, for repudiatory breach) as well as under the contract’s express terms. Where an agreement is silent on termination, the courts will, in any dispute, apply common law principles. To minimise uncertainty, parties typically include clear contractual provisions dealing with termination. As a general rule, contractual termination rights are additional to, and not a substitute for, common law rights. In the absence of wording to the contrary, the default...

This Practice Note examines the annulment of bankruptcy orders under section 282 of the Insolvency Act 1986 ( IA 1986), together with the grounds upon which an annulment application can properly be based. For further reading on the steps for applying to annul a bankruptcy order, see Practice Note: The process of annulling a bankruptcy order. The effect of a bankruptcy order being annulled The annulment of a bankruptcy order restores matters to the position that existed before the order was made, because the order is cancelled in effect. Consequently, the debtor remains liable in full for every bankruptcy debt, while any property that had vested in the trustee in bankruptcy passes back to the debtor accordingly. Any sale or other disposition of property forming part of the bankruptcy estate by the official receiver or the trustee in bankruptcy before the annulment of the...

This Practice Note describes: the meaning of ‘disguised remuneration’ how the disguised remuneration charge operates, and the tax consequences of a disguised remuneration charge This Practice Note is confined to the parts of the disguised remuneration regime that relate to employee share incentives and is not a full commentary on the legislation. The Finance Act 2011 brought in Part 7A of the Income Tax ( Earnings and Pensions) Act 2003 ( ITEPA 2003), aimed at countering what has come to be widely called ‘disguised remuneration’ via employee benefit trusts. In broad terms, ‘disguised remuneration’ covers arrangements that use third parties (frequently employee benefit trusts) to provide value to employees in a manner that avoids or postpones liabilities to income tax and national insurance contributions ( NICs). The use of a third party is essential for ITEPA 2003, Pt 7A to...

Scope of the General Product Safety Regulations 2005 The General Product Safety Regulations 2005, SI 2005/1803 ( GPSR 2005), set the legal framework to ensure consumer products are safe in Great Britain. They outline the conditions and responsibilities for placing consumer goods on the GB market. states that products introduced to the market or supplied by producers and distributors must be safe clarifies the meaning of a safe product imposes duties on producers and distributors consistent with marketing safe products establishes a presumption of conformity for items that meet UK national safety standards mandates and authorises enforcement authorities to take whatever action is necessary to protect consumers from unsafe products Separate rules apply to the placing on the market of consumer products in Northern Ireland and within the EU. For details on EU consumer protection law, see:...

For details of the duties on producers and distributors under the General Product Safety Regulations 2005, SI 2005/1803 ( GPSR 2005), refer to Practice Note: General Product Safety Regulations 2005— Offences. For information on prosecuting offences under GPSR 2005, SI 2005/1803, including the maximum sentences available on conviction, see Practice Note: Prosecution of product safety offences under the General Product Safety Regulations 2005. Notification requirements In England and Wales, where producers or distributors become aware that a product they have placed on the market or supplied to a consumer fails to meet the general safety requirement, they are obliged to notify the relevant enforcement authority of that information. They must also provide details of the steps they have taken to prevent risk to the consumer. The Office of Product Safety and Standards ( OPSS) guidance on the notification requirements contains a template...

This Practice Note This Practice Note addresses the strategic and practical considerations to be weighed when registering a trade mark. It provides guidance on selecting a trade mark, determining the appropriate territorial scope, drafting the specification, performing clearance searches and undertaking a cost–benefit assessment. It also presents a concise synopsis of the practical procedure involved. The primary focus is on the points to consider when registering a UK trade mark, though, where relevant, it refers to both UK and EU case law and legislation, and to EU trade mark registrations ( EUTMs), as appropriate. The UK is no longer part of the EUTM system, as Regulation ( EU) 2017/1001 was revoked in the UK at 11.00 pm on 31 December 2020 ( IP completion day). However, pursuant to the Trade Marks ( Amendment etc) ( EU Exit) Regulations 2019, SI 2019/269, and the Designs and...

Enforcement under the Food Safety Act An authorised officer of an enforcement authority may enter any premises within the authority’s area, at all reasonable hours, for the purpose of ascertaining whether the Food Safety Act 1990 ( FSA 1990) is being, or has been, contravened on those premises. If the occupier requests it, the officer must be able to produce duly authenticated documentation confirming their authority to act in that capacity. An authorised officer also has the power to enter any business premises, whether inside or outside the authority’s area, to establish whether there is any evidence or indication, on those premises, of any contravention, within that area, of the FSA 1990. An authorised officer of a food authority may, in addition, enter any premises whenever necessary and appropriate in order to perform their functions under the FSA 1990. Where premises are used solely as a...

The legal requirements of hallmarking Under the Hallmarking Act 1973 ( HA 1973), the sale of goods marketed as 'gold', 'silver', 'platinum' or 'palladium' is lawfully regulated. A hallmark comprises a set of symbols stamped on articles of these precious metals, confirming independent assessment by an Assay Office. It is a guarantee that the article complies with the law. This assures the piece meets statutory thresholds for precious metal content, called 'fineness'—the proportion of precious metal to alloy in the item, expressed in parts per thousand. Items claimed to be wholly or partly gold, silver, platinum or palladium must carry the correct hallmarks prior to supply or any offer to supply, before sale. Save for limited exemptions, goods without hallmarks must not be described as wholly or partly made from gold, silver, platinum or palladium. Premises where articles of gold, silver or platinum are made,...

A bankrupt is discharged from bankruptcy one year after the bankruptcy begins, unless the court suspends that discharge because the bankrupt has failed to co-operate with the official receiver ( OR) or the trustee in bankruptcy (trustee) ( IA 1986, s 279). On discharge, the disqualifications and restrictions that apply to an undischarged bankrupt come to an end. For further detail on those disqualifications and restrictions, see Practice Note: The immediate effects of a bankruptcy order on the bankrupt. What is the bankruptcy restrictions regime and why was it introduced? In cases where bankruptcy is not the product of honest misfortune, but arises from the bankrupt’s misconduct or recklessness, it is regarded as appropriate that the bankruptcy disqualifications and restrictions should continue for longer than one year, to protect the public interest and act as a deterrent. Accordingly, the Enterprise Act 2002 ( En A 2002)...

European Commission investigations The European Commission ( Commission) examines indications or allegations of anti-competitive behaviour by companies that affect more than one EU Member State—for instance, international price-fixing cartels and other collusive practices prohibited by Article 101(1) TFEU, or situations where a company seems to misuse a dominant position contrary to Article 102 TFEU. Note—criminal action against individuals can be pursued in some Member States, but not by the Commission... Investigations may begin in one of four ways: an implicated party coming forward as a whistleblower, a complaint submitted by a third party, the Commission obtaining market intelligence suggesting a breach of competition law—for example, press reports or informal customer complaints, or the Commission identifying suspected infringements during a sector inquiry (see EU Sector...

permits a borrower to apply for, and secure, an accelerated authorisation to pay UK-source interest to a non- UK lender at the reduced withholding tax rate (which could be 0%) set under the relevant double tax treaty ( DTT) with the UK, where the lender has already obtained a passport confirming it is resident in the appropriate jurisdiction and entitled to the benefit of the applicable DTT between that jurisdiction and the UK. This expedited route operates only where the passport has been granted to that lender concerned. The current DTTP scheme applies to loans entered into (or transferred) on or after 6 April 2017, and the terms, conditions and guidance for the present DTTP scheme were updated in October 2023. There was also a minor update in April 2024, which solely removed a reference to ‘ DTTP30620 DTTP2A...

Where an individual or entity (the Buyer) acquires a company, as opposed to buying the assets of a business, they also inherit all historic liabilities of that company and its subsidiaries (together, in this Practice Note, the Company). A Buyer of the Company’s share capital will usually look for the twin safeguards of a suite of tax warranties and a tax covenant from the current owner of those shares (the Seller). The exact scope and level of that protection will, naturally, reflect the parties’ respective negotiating strength. There are three principal reasons for a Buyer to require tax warranties in a share purchase agreement ( SPA): to draw out information by informing and underpinning the due diligence process to guard against unknown tax liabilities of the Company relating to periods before Completion (when the sale is finalised and the shares are...

The derivative contracts regime The derivative contracts regime sets out how a company’s profits and losses from its ‘derivative contracts’ are taxed and relieved. The principal provisions appear in Part 7 of the Corporation Tax Act 2009 ( CTA 2009) and, in this Practice Note, are called Part 7. Relevant secondary legislation includes the ‘ Disregard Regs’—the Loan Relationships and Derivative Contracts ( Disregard and Bringing into Account of Profits and Losses) Regulations 2004, SI 2004/3256, as amended. This Practice Note explains how profits and losses from a company’s derivative contracts are calculated and recognised for corporation tax. For the definition of a ‘derivative contract’ for corporation tax and the instruments and transactions within the scope of the derivative contracts rules, see Practice Note: Taxation of derivatives—what are derivative contracts? For deeper analysis of particular features of the rules, see these Practice Notes: Taxation of...

This Practice Note is about the issues that arise on a transfer of a going concern involving land and buildings For VAT purposes, a transfer of a going concern ( TOGC) carries two separate meanings: the ordinary sense, being simply the disposal of a continuing business—this is relevant, in particular, to the purchaser’s VAT registration position; and a transaction treated as a non-supply for VAT purposes, so that, in particular, no VAT is chargeable on it Although both uses are often described as a TOGC, for the remainder of this Practice Note the term is confined to the second of these meanings, referring to a non-supply......

FORTHCOMING CHANGE relating to the modernisation of stamp taxes on shares framework: In 2027, stamp duty and SDRT are set to be superseded by a single, self-assessed levy on securities—the securities transfer charge ( STC)—which will be paid (and reported) via a new online portal as part of the modernisation programme. Broadly, the STC’s features will reflect the proposals for that tax described in a consultation carried out in 2023; in general terms, its operation is intended to align with those recommendations. Finance Bill 2026 ( FB 2026) creates a power, commencing on Royal Assent, for secondary legislation to let taxpayers pilot the new digital service by self-assessing their stamp taxes on securities obligations and by reporting transactions electronically through a digital service, thereby enabling end-to-end testing. For further information on modernising stamp taxes on securities, see the following: News Analyses: Budget 2025— Tax...

Alongside the notion of new consideration—explored further in Distribution key concepts—new consideration—the principle of repayment of capital is central, in practice, to deciding whether particular transactions amount to distributions. At its broadest level, the purpose in invoking repayment of capital is to ensure that the definition of distribution captures only a genuine and actual distribution of profits, in whatever form, by confirming that payments which merely return capital originally contributed to a company’s shareholders are not treated as distributions, and are therefore excluded. For more on distributions generally, see: Scope of distributions for tax purposes. Where is repayment of capital used?......

This Practice Note sets out how the capital allowances rules interact with the rules relating to: capital gains tax, including corporation tax on chargeable gains ( CGT) value added tax ( VAT) stamp taxes, namely: stamp duty land tax ( SDLT) in England and Northern Ireland land and buildings transaction tax ( LBTT) in Scotland land transaction tax ( LTT) in Wales It is often, but mistakenly, believed that a claim to capital allowances for plant and machinery will cut the CGT base cost of an asset and so increase any chargeable gain. That is not the case: claiming plant and machinery allowances does not reduce a taxpayer’s CGT base cost in a capital asset...

Practice Note This Practice Note sets out how gains and deficits are brought into account for corporation tax when a derivative contract serves as a hedge. As with most matters involving derivatives, the tax treatment of hedging instruments is hard to grasp without a basic grounding in the pertinent accounting rules and concepts. Accordingly, this Practice Note first outlines the accounting for hedging arrangements and then turns to the applicable tax provisions. For broader background on the accounting framework and the principal accounting ideas relevant to taxing financial instruments, see Practice Note: Loan relationships—accounting framework and principles. A comprehensive description of the relevant accounting concepts and principles lies outside the scope of this Practice Note. Any discussion of accounting rules here is not exhaustive and does not amount to accounting advice. It is provided solely to aid understanding of the derivative contracts tax regime and to...

FORTHCOMING CHANGE relating to the modernisation of stamp taxes on shares framework: Following the 2020 call for evidence and the 2021 publication, and after scrutiny by the relevant HMRC and industry working group alongside the 2023 consultation, the government confirmed, in the consultation outcome released on 28 April 2025, that in 2027 it plans to replace stamp duty and SDRT with a single, self‑assessed stamp tax on securities, broadly consistent with the proposals set out in the 2023 consultation document. In addition, the government is consulting on updating and clarifying the legislation underpinning the higher 1.5% stamp tax charge. For more detail, see the following News Analysis articles: Tax update spring 2025— Stamp taxes on shares modernisation Tax update spring 2025— Tax analysis— Stamp and transfer taxes TAMD 2023— Stamp taxes on shares modernisation TAMD...