Private client review for October 2024

In this article, the October monthly update for Tax Journal, Edward Reed and Clare Wilson look at a number of private client developments.

This month, we consider the types of business that qualify for various tax reliefs and the thresholds which must be met. In Putney Power Ltd and another, EIS relief was denied by the FTT on the basis that the taxpayers had failed to commence trading within the requisite time limits – concluding that a trade commences only when the trader is “open for business”. In Dimitrakis G Demetriou and another, the FTT considered that a fishery business did not qualify for BPR on the basis that it was mainly an investment business. Equity Advisory Ltd illustrates the high threshold for departing in tax litigation from the default position of open justice, even where this concerns a non-party. Finally, two recent FTT decisions (Hill and Farmer) remind us that the test for whether a taxpayer has a reasonable excuse for non-compliance with their tax obligations is an objective one, and so genuine reliance on an advisor or an honest (if mistaken) belief that they are not in default will not necessarily meet the threshold. 

Read the full article.