IGNATIUS TEDESCO v Revenue & Customs (CAPITAL GAINS TAX ­ calculation of gain upon disposal of shares in company) [2022] UKFTT 171 (TC) (27 May 2022)

IGNATIUS TEDESCO v Revenue & Customs (CAPITAL GAINS TAX ­ calculation of gain upon disposal of shares in company) [2022] UKFTT 171 (TC) (27 May 2022)

Repayment of company debt by a shareholder prior to a share sale does not constitute allowable expenditure 'on' the shares under Section 38(1)(b) TCGA 1992, as it does not result in a change to the state or nature of the shares beyond mere enhancement of value. The cost is therefore not deductible in calculating the...

Source-derived case information.

Citation
[2022] UKFTT 171
Parties
Appellant: Ignatius Tedesco; Respondents: The Commissioners for Her Majesty’s Revenue and Customs
Jurisdiction
United Kingdom
Judgment Date
27 May 2022
Procedural Posture
Tax Appeal / First Tier Tribunal (tax Chamber) Substantive Judgment After Paper Hearing
Outcome
Appeal dismissed
Legal Topics
Capital Gains Tax, Calculation of Gain on Disposal of Shares, Allowable Costs of Disposal, Section 38(1)(b) TCGA 1992
Tax Law Capital Gains Tax Calculation of Gain on Disposal of Shares Allowable Costs of Disposal Section 38(1)(b) TCGA 1992

Source-derived case record

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 2 Authorities cited 7 Party arguments 2 Amounts and remedies 6
Sign in to unlock

Parties

Ignatius Tedesco

Appellant

The Commissioners for Her Majesty’s Revenue and Customs

Respondents

Procedural Posture

Tax Appeal / First Tier Tribunal (tax Chamber) Substantive Judgment After Paper Hearing

Legal Issues

  1. 1 Whether repayment of company debt by shareholder prior to share sale constitutes allowable expenditure on the shares under Section 38(1)(b) TCGA 1992
  2. 2 Whether such repayment is reflected in the state or nature of the shares at disposal

Ratio Decidendi

Repayment of company debt by a shareholder prior to a share sale does not constitute allowable expenditure 'on' the shares under Section 38(1)(b) TCGA 1992, as it does not result in a change to the state or nature of the shares beyond mere enhancement of value. The cost is therefore not deductible in calculating the capital gain on disposal.

Court Disposition

Appeal dismissed

Orders

  • Figures in the closure notice are confirmed.