Summary
A negligible value claim under TCGA 1992, s 24 (and income tax loss relief under ITA 2007, ss 131, 132) in respect of shares was not allowable, as the shares were already of negligible value at acquisition.
Background
The appellants (a married couple) made loans to their daughter’s company (JDDL). The company began trading on or around 1 April 2005. It made a small accounting profit in the period to 31 March 2006, but incurred trading losses in the following two years. It had no, or negligible, assets and was being supported by loans (made by the appellants and their family trusts). On 31 October 2007, the loans were partially capitalised by the issue to the appellants of shares in JDDL.
JDDL ceased trading in late 2008 or early 2009, and was wound up and struck off the register of companies on 31 August 2010. The appellants claimed that their
