Delaware income

The taxpayer was resident in the UK but not domiciled in the UK

He was a member of a Delaware limited liability company classified as a partnership for American tax purposes making him liable to US federal and state taxes on his share of the profits.

He remitted his profits to the UK and claimed double taxation relief.

HMRC refused on the basis the income subject to tax in the US was not his but that of the company.

The First-tier Tribunal allowed the taxpayer’s appeal but the Upper Tribunal reversed the decision. The Court of Appeal agreed with the Upper Tribunal.

The taxpayer appealed again contending the US and UK tax were charged on “the same profits or income” within the meaning of countries’ double tax treaty – even assuming American tax was due on the profits of the company and that he was liable...