*UBS AG v Revenue and Customs Commissioners; DB Group Services (UK) Ltd v Revenue and Customs Commissioners
Income tax Earnings from employment. The Supreme Court allowed the appeal by the Revenue and Customs Commissioners concerning schemes used by UBS AG and DB Group Services (UK) Ltd, which were designed to avoid the payment of income tax on bankers' bonuses. The court held that the tax exemption in of the Income Tax (Earnings and Pensions) Act 2003, did not apply in the present case in respect of the schemes whereby shares were awarded to employees in place of bonuses. The court ruled that, on the true construction of s 423 and in the circumstances of the present case, income tax was payable on the value of the shares on the date of their acquisition.
Costs Order for costs. The Chancery Division, allowed the third to sixth defendants' application under CPR40.12 seeking clarification or amendment of an order for costs made following the trial of a probate action concerning a will. The amount of the claimant's personal liability for the costs of the third to sixth defendants under the order was not limited by reference to the amount of her pecuniary legacy. The court exercised its inherent power under CPR 40BPD 4.5 that the order be amended to add words to the order to ensure any ambiguity in the order was removed.
Mistake Rectification. Two properties were placed in trust for the benefit of the claimant. Her father loaned her money to purchase one of the properties. The claimant made a settlement by which she would pay the loan back to her father. The solicitor failed to inform her of the negative effects of doing so. On learning of the negative effects, she sought to have the settlement set aside, on the grounds of equitable mistake. Her Majesty's Revenue and Customs Commissioners resisted the application. The Chancery Division held that, applying settled law, it was appropriate for the settlement to be set aside.
Passing off Clothes. The defendant retailer, Topshop, had sold a t-shirt with an image of the pop star Rihanna. The t-shirt was not officially endorsed by her and while the photograph had been licensed to Topshop by the photographer, it had been taken during a video shoot for the star's new album. Rihanna successfully issued proceedings for passing off. The Court of Appeal, Civil Division, dismissed Topshop's appeal as the judge had not made any error in his identification of the relevant law or his application of it to the present case.
Income tax Corporation tax. The First-tier Tribunal (Tax Chamber) (the FTT) allowed the taxpayer's appeal against the Revenue and Customs Commissioners' amendment to its corporation tax self-assessment return. The Upper Tribunal (Tax and Chancery Chamber) dismissed the Revenue's appeal and the parties appealed against that decision. The Court of Appeal, Civil Division, held that the FTT had properly interpreted of the Capital Allowances Act 2001. However, there was a very real concern that the FTT had misdirected itself in its approach to the inquiry under that section and its decision was too unsafe to be allowed to stand.
Contract Services. The Technology and Construction Court considered the interpretation of a contract between the parties, under which the claimant companies provided services to the defendant. The issue arose as to whether the claimants would be entitled to further remuneration if they went into liquidation. The court held that the claimants would be entitled to a declaration that the contract referred to any further payment to which it would or might otherwise be entitled pursuant to the contractual provisions relating to payment.
Corporation tax Advance corporation tax. The taxpayer had sought payment of tax credits in respect of foreign dividends it had received. The First-tier Tribunal (Tax and Chancery Chamber) and Upper Tribunal both found many of those claims were time-barred by virtue of s43 of the . The Court of Appeal, Civil Division, dismissed the taxpayer's appeal and held that a taxpayer was entitled to the set off or payment referred to in of the Income and Corporation Taxes Act 1988 if, but only if, he made a claim. Such a claim to a tax credit was a claim for relief and so s43 of the 1970 Act applied to such a claim.
*Fiscale eenheid PPG Holdings BV cs te Hoogezand v Inspecteur van de Belastingdienst/Noord/kantoor Groningen
European Union Value added tax. The Court of Justice of the European Union made a preliminary ruling concerning the interpretation of arts 13B(d)(6) and 17 of Sixth Council Directive (EEC) 77-388 (on the harmonisation of the laws of the Member States relating to turnover taxes Common system of value added tax: uniform basis of assessment). The request had been made in proceedings between Fiscale eenheid PPG Holdings BV cs te Hoogezand (PPG) and the Inspecteur van de Belastingdienst-Noord-kantoor Groningen concerning an additional assessment to VAT for the period from 1 January 2001 to 31 December 2002 in respect of the costs associated with services relating to the management and operation of a pension fund which PPG had set up in the form of a legally and fiscally separate entity, in order to safeguard the pension rights of its employees and former employees.
European Union Taxation. The Court of Justice of the European Union dismissed the action by the European Commission for a declaration that, by permitting non-taxable persons to be members of a group of persons regarded as a single taxable person for purpose of VAT, Ireland had failed to fulfil its obligations under arts 9 and 11 of Council Directive(EC) 2006-112 of 28November 2006 (on the common system of value added tax).
European Union Freedom of establishment. The Court of Justice of the European Union made a preliminary ruling concerning the interpretation of arts 49 and 54 of the Treaty on the Functioning of the European Union in the course of proceedings brought by A Oy, a company governed by Finnish law, against a decision of the Finnish Central Tax Board that A Oy could not, in the context of a merger with a Swedish subsidiary, deduct from tax that subsidiary's losses.