John Buckingham v The Commissioners for HMRC

John Buckingham v The Commissioners for HMRC

The Special Dividend was part income and part capital under Delaware law; only the income portion is taxable as income in the UK. The review officer's decision to increase the assessment was out of time and invalid, and the original discovery assessment stands.

Parties
Appellant: John Buckingham; Respondents: The Commissioners for His Majesty’s Revenue and Customs
Jurisdiction
England and Wales
Judgment Date
04 April 2023
Procedural Posture
Income Tax and Capital Gains Tax Appeal / Final Judgment After Statutory Review and Tribunal Hearing
Outcome
Appeal allowed in part; original discovery assessment confirmed; review decision not upheld.
Legal Topics
Discovery Assessment, Statutory Review, Foreign Dividends, Income Vs Capital Classification, Time Limits for Review Decisions
Tax Law Administrative Law Discovery Assessment Statutory Review Foreign Dividends Income Vs Capital Classification Time Limits for Review Decisions

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Parties

John Buckingham

Appellant

The Commissioners for His Majesty’s Revenue and Customs

Respondents

Procedural Posture

Income Tax and Capital Gains Tax Appeal / Final Judgment After Statutory Review and Tribunal Hearing

Legal Issues

  1. 1 Whether the Special Dividend from a US company was income or capital for UK tax purposes
  2. 2 Whether HMRC's statutory review decision was out of time
  3. 3 Interaction between discovery assessment and statutory review provisions

Ratio Decidendi

The Special Dividend was part income and part capital under Delaware law; only the income portion is taxable as income in the UK. The review officer's decision to increase the assessment was out of time and invalid, and the original discovery assessment stands.

Court Disposition

Appeal allowed in part; original discovery assessment confirmed; review decision not upheld.

Orders

  • Mr Butler’s discovery assessment is confirmed and not increased.
  • Ms Vickerman’s review decision is invalid and does not vary the assessment.