FTT releases decision in Lloyd’s Banking Group Cross Border Group Relief Appeal
The FTT has released its decision on whether Lloyds Asset Leasing Limited (LAL) was entitled to claim cross border group relief (CBGR). LAL was one of 100 subsidiaries of the Lloyd’s Banking Group (LBG) to whom Bank of Scotland Ireland (BOSI) sought to surrender losses it incurred in relation to its banking business in Ireland. Over 100 LBG subsidiaries made claims for CBGR and enquiries were opened.
By a Closure Notice, HMRC disallowed LAL’s claim for CBGR on the basis that the qualifying loss conditions in s119 CTA 2010 were not satisfied and, in the alternative, s127 CTA should apply as the “main purpose or one of the main purposes” of the arrangements by which BOSI’s losses were sought to be surrendered was to secure that the amount in question may be surrendered for the purposes of group relief.
Over the course of a 3 week hearing before the FTT, LAL adduced evidence from LBG’s CEO, Finance Director and Wealth and International Director at the material time as well as M&A, Regulatory, Irish Corporate, Dutch Law and Irish Law expert evidence in support of its case that the obtaining of CBGR was not the main purpose or one of the main purposes of the arrangements put in place by LBG to exit Ireland.
The FTT has now released its Decision dismissing LAL’s appeal against HMRC’s refusal of the CBGR claim. The FTT found that LBG satisfied the qualifying loss condition in s119 and the precedence condition in s121 but that s127 applied to exclude group relief as the main purpose or one of the main purposes of the arrangements put in place by LBG to exit Ireland was to secure CBGR for BOSI’s accumulated losses.
The Decision can be accessed here.
Akash Nawbatt KC, Brendan McGurk KC (Monckton Chambers), and Kate Balmer represented HMRC.
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