A payment required by a clause in a shareholders’ agreement on a claim following a winding up of the relevant company was made under an indemnity as opposed to a guarantee and, therefore, no capital loss relief was available in respect of the payment. 
 
In 1998, the appellant entered into a joint venture with a third-party company (TAGH). The joint venture vehicle was a company (TAGMA). The appellant and TAGH made a series of investments in TAGMA by way of loans and subscriptions for ordinary and preference shares. 
 
The appellant and TAGH entered into a shareholders’ agreement in July 2001. Clause 10.3 provided: ‘To the extent that any of the Shareholders do not receive satisfaction in full in the winding-up of the Company of all sums due or to fall due to them, then the aggregate shortfall between all sums due or to fall due to the Shareholders and all amounts actually recovered by the