The Upper Tribunal was satisfied that the First-tier Tribunal made no error of law in the test it applied when finding that the place of effective management of family trusts engaged in ‘round the world’ tax planning arrangements was the UK in the relevant period. 

The first and second appellants were the settlors of separate family trusts, which engaged in a tax planning arrangement known as the ‘round the world’ scheme. The appellants hoped the trustees of the family trusts would avoid capital gains tax (CGT) on disposals of shares on the flotation of a company. The scheme would have been effective in achieving the capital gains tax (CGT) savings if (among other things) the family trusts became resident in Mauritius by the time of disposal. This required the place of effective management (POEM) of the trusts to have been in Mauritius. On appeal against a challenge by HM Revenue and Customs, the First-tier Tribunal (FTT) held that