This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies. To find out more about cookies on this website and how to delete cookies, see our privacy notice.

Place of effective management of trusts was the UK

By Mark McLaughlin, June 2024

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

Subscribe to the McLaughlin’s Tax Case Library to get instant access
to the Tax Case Library.
14 day free trial , 90 day money back guarantee
Subscribe

Related or similar articles

Taxpayer entitled to entrepreneurs’ relief as LLP had commenced trading
By Mark McLaughlin, September 2024
Transfer of beneficial ownership of a joint property arose in the tax year a married couple separated
By Mark McLaughlin, December 2023
Payment under guarantee was allowable as the company had commenced trading
By Mark McLaughlin, November 2019
Capital loss for guarantee was deductible in the tax year of payment
By Mark McLaughlin, May 2019
Corresponding Deficiency Relief Did Not Reduce CGT Rate On Chargeable Gains
By Mark McLaughlin, November 2018