A company's yacht chartering business was carried out on a commercial basis, and was also carried out with a view to the realisation of trading profits, such that losses of that business were allowable against the company’s other trading income.
The appellant company’s principal business activities included construction, investing and managing industrial and commercial property. The company purchased a yacht in 1998 for charter.
In 2003, the yacht suffered a “catastrophic engine failure”. Losses were suffered over the period between 2003 and 2008 when the engines were out of action, as any chartering of the yacht was limited to “static charters” (i.e. the yacht was moored in one place). Further losses were suffered between 2009 and 2012 due to difficulties in promoting charters, which were exacerbated by the banking crisis and subsequent global recession.
Following an
