In the latest tax case reports, Sharon Khin considers the CGT exemption in Ames, AIA denied over discontinuance, transfer pricing rules in Abbey National Treasury Services and a long-running tax dispute reaches beyond the grave, while Airbnb has a grilling from the Irish Revenue over tax liability and intermediaries
Case report: CGT exemption only available if EIS relief claimed
In Ames v Revenue & Customs (Income Tax/corporation tax: exemptions and reliefs) [2015] UKFTT 337 (TC), Ames invested £50,000 in shares which HMRC accepted were eligible for enterprise investment scheme (EIS) income tax relief. However, he did not claim relief because he had no taxable income in the relevant year.
Ames then sold the shares realising a gain of £272,540 but did not include the gain on his self assessment tax return because he believed the disposal qualified for the EIS capital gains tax (CGT) exemption under the Taxation of Chargeable Gains Act 1992 (TCGA 1992), s150A.
HMRC amended Ames’ return to include the gain, on the basis that the CGT exemption was only available if EIS income tax relief had been claimed. It also refused to allow the late claim for EIS income tax relief.
