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The taxpayer was a retired solicitor. He owned 14.65% of the equity in a limited liability partnership set up in June 2015 to acquire construct and operate a biomass power plant.
In August 2015 the partnership entered into several contracts. In September 2016 it applied to the Environment Agency for a permit to operate the plant - this was issued in May 2017.
In November 2016 the taxpayer disposed of 666 of his 1 465 units in the partnership and claimed entrepreneurs' relief. At that time the site was being cleared but no construction had started – the detailed design of the plant was still being worked on.
HMRC refused relief on the basis the LLP had not been trading for one year at the point of disposal so the conditions for the relief were not met.
The taxpayer appealed.
The First-tier Tribunal noted that the taxpayer had...
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