In the case of Barnes v R & C Commrs [2014] EWCA Civ 31, the Court of Appeal upheld the decision of the Upper Tribunal that a tax avoidance scheme which attempted to create an income tax deduction failed. 

Mr Barnes entered into a marketed tax avoidance scheme which involved borrowing £38m (market value) of gilts on the first day and then repaying the loan with the same gilts (plus an extra £2,742.86 of margin gilts) on the second day.

The transaction was timed so that Barnes received the next interest payment on the gilts and the amount of the gilt loan calculated so that the interest payment equalled the amount of income he wished to shelter.