Icebreaker – Seven Individuals v HMRC

Seven Individual Referrers v HMRC [2016] UKUT 0361 (TCC)

Jonathan Davey QC  won a major victory for HMRC in a high profile tax case. In the appeal of the “member level” issues in the long running Icebreaker litigation the Upper Tribunal (Mr Justice Nugee) decided all points in favour of Jonathan’s clients. The case concerns whether multi-million pound losses incurred by creative industry limited liability partnerships can be utilised by members of the partnerships to reduce their income tax liability. The Upper Tribunal held that they could not. The issues dealt with by the Upper Tribunal included: (i) whether the trades of the partnerships were carried on on a commercial basis and with a view to profit (answer – no); and (ii) whether the arrangements in question had a main tax avoidance purpose (answer – yes).

Jonathan was leading Imran Afzal (Field Court Tax Chambers), Nicholas Macklam (Radcliffe Chambers) and Sam Chandler (5 Stone Buildings).

Download the Judgment here (Crown Copyright)