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.

Redress payments from bank were taxable, and penalties upheld

By Mark McLaughlin, March 2023

Redress payments arising from a swap arrangement relating to the interest rate on a loan were taxable and penalties for inaccuracies in the appellants’ tax returns were upheld. 

The appellants entered into a loan from Barclays to acquire a property, which was to be used by a company (of which they were the sole shareholders) that conducted a telecoms business. Between exchange and completion of the property transaction, Barclays encouraged them to also enter into a swap arrangement relating to the interest rate on the loan.  

Subsequently, the appellants participated in an independent review process regarding interest rate hedging product mis-selling, which had been set up by (what is now) the Financial Conduct Authority. In May 2014, Barclays made an offer to the appellants of £443,592, which the appellants accepted. The funds were paid (after deduction of income tax from the interest element of the redress payment) to the

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

Appeals against failure to notify penalty and personal liability assessment dismissed
By Mark McLaughlin, June 2026
HMRC’s top slicing relief calculations had ceased to be ‘practice generally prevailing’ for overpayment relief purposes
By Mark McLaughlin, August 2025
Gifts by individual were not qualifying donations and tax relief was recoverable from charity
By Mark McLaughlin, February 2025
Conditions for valid HMRC discovery assessments were not met
By Mark McLaughlin, November 2024
Income accrued while individual was in prison was taxable
By Mark McLaughlin, July 2024