Lewis v Revenue and Customs (INCOME TAX/CORPORATION TAX : Losses) [2016] UKFTT 254 (TC) (18 April 2016)

Lewis v Revenue and Customs (INCOME TAX/CORPORATION TAX : Losses) [2016] UKFTT 254 (TC) (18 April 2016)

The Tribunal found that the appellant had subscribed for the shares as required by s131(2)(b) ITA 2007, the shares were not of negligible value at acquisition but became so during his ownership, and the acquisition cost for share loss relief purposes should be the market value at acquisition, determined to be £60,000.

Citation
[2016] UKFTT 254 (TC)
Parties
Appellant: John Lewis; Respondents: The Commissioners for Her Majesty’s Revenue & Customs
Jurisdiction
United Kingdom
Judgment Date
18 April 2016
Procedural Posture
Income Tax Appeal / First Tier Tribunal (tax Chamber) Substantive Decision
Outcome
Appeal allowed in part
Legal Topics
Income Tax, Share Loss Relief, Capital Gains Tax, Valuation of Shares
Tax Law Income Tax Share Loss Relief Capital Gains Tax Valuation of Shares

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Parties

John Lewis

Appellant

The Commissioners for Her Majesty’s Revenue & Customs

Respondents

Procedural Posture

Income Tax Appeal / First Tier Tribunal (tax Chamber) Substantive Decision

Legal Issues

  1. 1 Whether the appellant subscribed for the shares within the meaning of s131(2)(b) Income Tax Act 2007
  2. 2 Whether the shares were of negligible value at the time of acquisition for the purposes of s24 Taxation of Chargeable Gains Act 1992
  3. 3 What is the correct acquisition cost/market value of the shares for share loss relief

Ratio Decidendi

The Tribunal found that the appellant had subscribed for the shares as required by s131(2)(b) ITA 2007, the shares were not of negligible value at acquisition but became so during his ownership, and the acquisition cost for share loss relief purposes should be the market value at acquisition, determined to be £60,000.

Court Disposition

Appeal allowed in part

Orders

  • Appellant's claim for share loss relief is allowed but reduced from £99,900 to £60,000.