Case Report: Blenheims Estate and Asset Management Ltd [2013] TC - TopicsExpress

Case Report: Blenheims Estate and Asset Management Ltd [2013] TC 02696The First-tier Tribunal decided that a taxpayer company was not entitled to deduct amortisation and impairment accounting charges from its corporation tax under Finance Act 2002 (‘FA 2002’), Sch. 29, para. 9 in respect of its acquisition of goodwill of a business. FA 2002, Sch. 29, para. 118(1)(b) prevented such deduction because the taxpayer acquired the goodwill from its shareholder who, at the time of the acquisition, was a related party in relation to the taxpayer within the meaning of FA 2002, Sch. 29, para. 95. The shareholder was a related party, being a participator within FA 2002, Sch. 29, para. 100. He held shares in the taxpayer before, at the time of, and after he transferred the goodwill. Whilst there were various transactions transferring his shares in the taxpayer to a third party after completion of the agreement for the acquisition of goodwill, he remained a participator since the agreement was not subject to any conditions precedent and was not dependent in any way upon those transactions. Furthermore, those transactions intended that the shareholder should not cease to be a registered holder and beneficial owner of a specific number of the issued equity shares in the taxpayer.