HMRC beats Vocalspruce over £85m corporate avoidance scheme

Vocalspruce, a subsidiary of Brixton plc, a UK-based property business headquartered in London, has lost its case against HMRC at the Court of Appeal over an avoidance scheme used by a number of large businesses

The appeal centred on the use of a marketed tax scheme to exploit provisions in the loan relationships legislation and involved the capitalisation of the premium arising on the redemption of zero coupon loan notes in share premium accounts, which the court ruled against.

A total of £85.4m in tax was at stake, with a further £65.7m protected from other tax settlements where companies agreed to settlement arrangements with HMRC.

The case, Vocalspruce Ltd v R & C Commrs [2014] EWCA Civ 1302, was a lead case, with 43 follower cases.

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