Loss wiped out

The taxpayer company entered into a series of transactions between March and September 2003 disposing of nine shares acquired in 1969.

The main purpose of the actions was to establish a capital loss amounting to £200m relying on the identification rules in TCGA 1992 s 106 (repealed by FA 2006). HMRC disallowed the claim saying the value shifting provisions in s 30 applied.

The taxpayer took the matter to the First-tier Tribunal which dismissed the appeal.

The Upper Tribunal said the relevant acquisition date for s 30(9) was September 2003 not when the shares were acquired in 1969 meaning the disposal had in effect taken place before the acquisition. Section 30(5) required an increase to be made to the loss on the disposal to eliminate the loss claimed by the taxpayer.

The taxpayer’s appeal was dismissed.

The Revenue’s director general for business...