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Personal assets transferred to own company

Can my client's substantial personal assets be transferred to his company at cost?

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The company has no funds to pay for these assets and their value will simply be credited to the director's loan account. The assets are goods for resale and were acquired with the intention of being transferred to the company. They are appreciating assets and are intended to be held by the company for some 10-20 years before their eventual sale, i.e. no funds will be generated for 10-20 years. The assets have appreciated some over their initial cost and if market value was used as the base for the transfer, it would give rise to a capital gain for my client - who would then have tax to pay even though no funds had been generated and no cash had been received. It would seem fairer and more reasonable to use cost as the base for this transfer, given the long term nature of these assets. Crystalising a nominal gain at this early stage would not be fair and seems wrong, a bit like a company's stock being revalued each year at market value and the resulting book profits giving rise to an annual tax bill, again without any funds having been realised. This doesn't happen: stock is valued at the lower of cost or NRV, not the higher. Accordingly, given the long-term nature of these assets, would using cost as the basis for this transfer be acceptable? Obviously when the assets are eventually sold, the company would pay corporation tax on sale price less cost so there is no loss to HMRC. It is in effect just a timing issue. If my client does proceed with using cost for the transfer, is there any action he needs to take now? e.g. to advise HMRC or not?

Thanks for any assistance here, it will be appreciated.

 

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Replying to Micawber:
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By Tax Dragon
14th Aug 2019 17:10

The comment I'd seen was DJKL's on 13th Aug 2019 at 14:28.

You'll have to make full disclosure at some point. I don't see why you couldn't ask in advance (unless instructed not to by the client).

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Replying to Micawber:
Hallerud at Easter
By DJKL
14th Aug 2019 17:34

They do not appear to so view them:

"HMRC’s view expressed there is that fortified wines and fine wines that mature particularly well would not be considered to be wasting assets. Liquors aren’t expressly referred to in the article but I am sure they would be similarly viewed."

Taxation Magazine comment on the HMRC note i supplied half a mile up the page.

https://www.taxation.co.uk/articles/2013-12-04-317471-wee-dram

see also CIR v Fraser (1942)

https://library.croneri.co.uk/cch_uk/btc/24-tc-498

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Replying to DJKL:
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By Micawber
14th Aug 2019 18:11

Yes, thanks, I did read these earlier. However, whereas it would be agreed that whisky in the bottle was not a wasting asset, whisky in the cask is a different prospect. Over 50 years, left untouched, it would certainly deteriorate and change. Whether that is sufficient basis for HMRC to accept it as wasting I am unsure, but the argument can be made.
The CIR v Fraser case is certainly interesting. Perhaps it might apply to this case and a short-lived trade is the right approach. One comment of the court though would not apply: "a commodity which yields no pride of possession" - oh no, huge pride of possession actually! (Unless it harms our case.)

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By bernard michael
14th Aug 2019 16:05

Perhaps the legal action settlement may have some bearing eg what type of action between who/what, is the settlement ratified by the court etc

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Replying to bernard michael:
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By Micawber
14th Aug 2019 17:02

The legal action is only a very small part of this and was very definitely a personal issue, no court involvement, but thanks anyway.

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By whitevanman
14th Aug 2019 19:58

What decided cases show is that the precise facts will determine the "trading / non-trading" issue. In particular, no one factor is decisive in all cases. The Fraser case demonstrated that, bulk whisky was not an asset that yielded "pride of possession" (judges are clearly out of touch). The holder of a large quantity therefore would be holding it with the clear intention of selling, at a profit (one hopes) at a future time, whether with or without modification. It is not an "investment". Therefore, absent any other facts, the logical conclusion is that the numerous casks held by the client were held for trading purposes (that is to say, with a view to the realisation of a profit). The fact that the whisky would deteriorate over time if not"modified" (at least bottled) is support for that position.
That would seem to suggest that whatever the client or HMRC might like to argue, the acquisition was "by way of trade". That being the case, there is no tax issue until transfer to the company, at which point s161 comes into play. Result is that the profit will be taxed when it arises and no need for further agonising.

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Replying to whitevanman:
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By Tax Dragon
14th Aug 2019 20:36

Please read s161 itself, rather than the rubbish written about it in this thread.

If it worked the way you imply, a) I have serious amounts of humble pie to digest and b) sellers of land to builders would never need to worry about CGT - they could just elect out of it.

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By Tax Dragon
14th Aug 2019 20:26

I'll try this one more time then I'll hang up if still no-one engages with my analysis. OP, you persist in ignoring my point.

Let's assume there was a sole trade, otherwise you simply have a CGT position- exempt if a wasting asset, taxable otherwise (and I don't believe the if-we-didn't-look-after-it-we-could-shorten-its-life argument holds much w.... carries much weight). It doesn't really matter when the trade started, since s161 allows you to treat the appropriation to stock as producing no gain - possibly some of the maintenance costs could go unrelieved, but that's small fry.

So... you have a sale at cost plus costs against which you set cost plus costs. Profit liable to income tax is Nil (I borrowed Lion's calculator for that one) - or possibly small if there were unrelievable maintenance costs.

You ALSO, AS WELL, TOO AND IN ADDITION have a DISPOSAL FOR CGT AT THE POINT OF TRANFER TO THE COMPANY (or "sale", to use technical jargon for a mo).

In calculating the CAPITAL GAIN, you exclude amounts already taken into account for income tax. (There's possibly a technical difficulty here but let's gloss over that.) That leaves you:
Proceeds = MV minus actual consideration.
Cost is already used up in establishing the trading result, leaving Nil (thanks again Lion)

Result- CGT unless the disposal is of a wasting asset.

In short I think the trade/not trade analysis makes bog all difference to the end result. (And why are you still pinning your hopes on s161?!)

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Replying to Tax Dragon:
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By Micawber
14th Aug 2019 20:49

I thought the trade scenario went like this: individual has personal assets held at cost, he decides to trade these and they are acquired as trading stock by his sole trader business at MV (deemed requirement); S161(3) defers the capital gain on the difference between cost and MV; his sole trader business then SELLS the assets to the company at MV and then ceases. The gain has been deferred and there is no profit or loss for the sole trader business. The company starts with stock at MV.
Is that not the case?

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Replying to Micawber:
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By Micawber
14th Aug 2019 20:55

Sorry, correction: S161(3) defers the gain but produces a profit for the sole trader business when the assets are sold to the company. Hmm.

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Replying to Micawber:
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By Tax Dragon
14th Aug 2019 21:14

Well sort of. Unless there's a MV rule for the sole trade, you'd use actual consideration, which you've set to create no (or minimal) actual profit. I think the excess of MV over consideration is capital gain, not trading profit (though I stand to be corrected).

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By whitevanman
14th Aug 2019 21:32

Sorry but my earlier post contained an important error and I do not wholly agree with any of the later posts. So, I will try again.
It is likely for the reasons in my last post, that the acquisition and holding of casks of whisky would be considered (by the courts) to be a trading matter.
If that was the case, S161 TCGA could NOT apply because that section only applies to assets taken into stock which were not (already) held as stock in trade. So the trading / non- trading point is very relevant.
Let us assume that the whisky could by some means, be regarded as acquired and held by the client other than as trading stock. Transferring it into a business as trading stock would mean that the acquisition is deemed to be at OMV.
Similarly the disposal is deemed to take place at OMV so a gain could arise. However, recognising that this could result in gains being charged that had not actually been realised, S161 TCGA allows for the gain to be, in effect, rolled over and set against the cost of stock. So assume asset value of 100 gives rise to gain of 10, the stock cost in the trading entity would be reduced to 90. There would be no net CG to the disposing party and the whole of any profit would be taxed on sale in the acquiring business.
One "problem" in all this is that the client would not get relief for any costs incurred, say on holding the casks, during his ownership.
If however, you accept that the original acquisition was "by way of trade" S161 TCGA cannot apply.
What does apply is the Sharkey v Werner decision, now legislated at S175 ITTOIA or, confusingly S156 to S161 CTA.
So, the transfer from stock as a sole trader to stock of the Company again takes place at OMV. That may not be a bad thing because, the value may not be significantly different to the cost and the sole trader can get relief against any profit (or generate a loss), for costs incurred.
So as with many other things, doing the maths is the first thing that will show whether there is a "problem" for the client. Whether if there is, you can do anything about it, is another matter given what I said at the outset as regards trading etc.

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Replying to whitevanman:
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By Micawber
15th Aug 2019 16:25

Many thanks for working this through succinctly. In this instance though the figures are significant and there is a substantial gain (on investment) or profit (on trade) between the cost price of the stock held personally and its OMV at date of transfer. And it's how to get that figure taxed in the company rather than taxed personally that's the issue.
I get the point that the acquisition of the stock could be seen as 'in the nature of trade' but could it also be seen as purely as an investment? Certainly the intention is (and was) to hold the stock for the long term (and folks do build up wine collections as investments, not as trading). The exit route eventually may be to realise it all in one sale - investment gain? Or it may be to bottle it and sell it, case by case, over a number of years - trading profits. But that would be for the company to decide in due course. It also has to be said that the number of casks involved may seem a very ambitious investment, and trading perhaps a more likely route even from the off.
The current issue is whether the large difference between cost price and OMV is taxable as a capital gain or as trading profit?
If it is seen to be trading profit, there would appear to be fewer options and a large personal income tax bill may await - and the profit is not all taxed in the company. Yet no cash has been received nor will be for some years. The cash basis for accounting would have been a thought but the limit is £150k T/O and the OMV is a few times that.
If it can be seen as capital gain, then there may be more scope to defer that and roll it forward into the company but......I take note of all that's been said, and there may not be.
Making the case for (a) wasting assets or (b) extending the principle of S161(3) ?

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By Tax Dragon
15th Aug 2019 08:31

So to summarise....

There's a capital gain (based on proceeds = MV when sold to the company) to the extent that those proceeds are not taken into account for income tax, in this case in calculating profits of a trade.

Chapter 11A (whitevanman's reference) would bring the full MV into the trading result. At least it would if it applied. I'll leave that point to others to discuss (which is relevant only if there was a trade anyway. We all agree there are trading motives, but none of this whisky has been offered for sale - other than to the company - so it's like a corner shop that is stocking up but hasn't opened its doors to the public. Is that trading?)

Ref Ch11A, I suspect the numbers involved here preclude the cash basis, so s172AA doesn't help. That leaves you arguing (if you want to) whether the sale to the company was a disposal "otherwise than in the course of a trade", per s172D.

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Replying to Tax Dragon:
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By Micawber
15th Aug 2019 16:41

Yes, agreed. That indeed summarises it.
The simplest view would be that the assets were initially acquired as a personal investment and no personal trading took place - supported by the fact that, to obtain some casks, the owner had to supply a written declaration that he was not a trader. (Unlicenced, you see?)
The transfer to the company was not for profit, normally an essential badge of trading. (Albeit having to move to OMV produces a very significant and unwanted profit.)
So the capital gain on transferring the original investment still looks a more advantageous position - if that can be held successfully.

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By whitevanman
15th Aug 2019 09:35

Cases such as Fraser show, amongst other things, that an asset cannot have indeterminate nature. So, in cases such as this there are 3 possibilities:
The whisky was acquired for personal consumption (somewhat unlikely given the apparent quantity). It was acquired as an investment (equally unlikely given the comments in Fraser and what has been said elsewhere in this chain) or it is for trading purposes (the undoubted frontrunner).
I think therefore the OP should proceed on that basis.
There is however one aspect no-one appears to have mentioned. The client apparently intended from the outset, to sell the whisky via a company. Could he argue that it was bought and held by him, in trust for the company? I seem to recall a case in the last few years (could be more than 5!) where a director provided services to a third party company before he set up his own company but succeeded nonetheless in arguing that all profits were those of his company. It may depend on the period involved but I wouldn't rule it out. That would certainly resolve all the problems we have discussed.

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Replying to whitevanman:
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By Tax Dragon
15th Aug 2019 10:00

Lion has raised this point.

Hard to argue though that you were buying on behalf of a company when you didn't know that you would need that company (apparently for licensing purposes).

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Replying to whitevanman:
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By Micawber
15th Aug 2019 17:02

Of the 3 possibilities, the investment option would still be arguable. The assets were collected over a number of years, never sold or traded, and have actually performed brilliantly as an investment. (Readers take note!) Hence the sizeable gain on disposal at OMV. At what point does a collection held, and added to, as an investment, become 'in the nature of trade'? Only at transferrance?
Also I don't see any immediate benefit in going down the trading option route - just a large income tax bill.
However your last point is very interesting and one to be examined and if necessary held on to (firmly) to the last. Many thanks for that.

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Replying to Micawber:
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By lionofludesch
15th Aug 2019 17:19

Micawber wrote:

Also I don't see any immediate benefit in going down the trading option route - just a large income tax bill.

You say this as though it's a choice.

It's either an investment or it's trading and you have access to more facts than us.

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Replying to lionofludesch:
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By Micawber
15th Aug 2019 18:13

No, I get it - ultimately the actual intentions and actions will determine the position, if HMRC were to take a view. But the owner's position does not appear to be benefited by maintaining that the transfer was in the nature of trade. He would maintain that his collection was begun as a personal investment which gained in value over the years and was subsequently passed on to a company formed to have more options for the future of the collection. Unfortunately, by so doing, he has incurred an unwanted capital gain. (Still better than a trading profit.)

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Replying to Micawber:
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By whitevanman
15th Aug 2019 23:45

Sorry but I don't think there is any question of investment here. Look at what was said in Fraser. The nature of the asset is such that the (almost) inevitable conclusion is that the intention, from the outset, was to realise the asset at some future date and that meant it was " in the nature of trade". It did not matter that the value had increased due to external factors nor that it was acquired (or ultimately sold) in one or more transactions. With a case so strongly on all fours with the clients, I think HMRC could be expected to contend for trading and you would find it exceedingly difficult if not impossible to refute such. As said previously, I think I would go for the "trust" argument but it will depend on precise dates and the case you can put together.

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Replying to whitevanman:
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By Micawber
16th Aug 2019 11:12

Many thanks for this. I am trying to separate the wood from the trees and get to a consensus opinion so this is indeed helpful. The trading position had not been considered or examined until now, but looks as though it must be accepted, so further scrutiny of the options available to the trader now comes into play.
So, let's try this: if we develop the trading position, the sole trader sells his stock to his own company (connected person) on his cessation of the sole trade business. Am I right in looking at the provisions of S166 CTA 2009 wherein it states that "if the stock is sold or transferred at: less than an arm’s length price then the arm’s length price is substituted; but if that arm’s length price is greater than both the acquisition value and the price received then the parties may make a joint election under S167 CTA 2009 or S178 ITTOIA 2005 to substitute whichever is the greater of the price received or the acquisition value." See hmrc/bim33480.
That being the case, if the sole trader sells to the company at a price slightly higher than cost price, that sales price is substituted for OMV - which produces only a small profit for the sole trader and a lower initial cost to the company, thereby leaving the company to take the great majority of the overall profit in due course.
Is this the 'eureka' moment or have I missed something?

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Replying to Micawber:
Hallerud at Easter
By DJKL
16th Aug 2019 15:03
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Replying to whitevanman:
Hallerud at Easter
By DJKL
15th Aug 2019 23:43

Something niggles in my head that I actually read that case, (somewhat rare for me) If correct it was a her not a him, it related to the oil industry and I think she was Edinburgh based- however the case name escapes me and the above could be mere ramblings of a memory years past its best.

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Replying to DJKL:
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By whitevanman
16th Aug 2019 00:03

I think you are confusing it. Fraser was a case from the 1940's (1942 I think) which involved the purchase of a quantity of whisky in bond. There were 3 acquisitions and several sales but they were viewed (cannot remember why) to some extent as "single" transactions. The value increased in the period of ownership (no doubt due to the war). The Commissioners found it was investment but that was overturned by the court due mainly to the nature of the asset.

DJKL Sorry. On re-reading, I'm not sure if you were referring to the case i mentioned in connection with the "trust" issue rather than Fraser. I got confused by the timings of the posts. I also cannot remember precise details of the "trust" case.

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Replying to whitevanman:
Hallerud at Easter
By DJKL
16th Aug 2019 14:56

No, it was the trust issue. If I recall it correctly there was some form of lucrative contract in the oil business, the director had the contract in her name and there was intent to pass it into a company , meetings with accountants etc, but for some reason that transfer failed to happen on time- the question was then whose was the income from the lucrative contract.

p.s. I certainly knew about Fraser as I posted the link above to it for the OP.

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By whitevanman
15th Aug 2019 10:16

Again, not sure I agree 100%.
All the initial postings from Micawber state the initial intention to transfer to company to exploit.
As regards licensing, the post at 15.48 on 14 August says he was advised to set up company to get licensed etc and that process took some time. Once settled the transfer was made.
I don't think only companies can be licensed so the fact that he pursued that route is at least suggestive of his intentions.

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By Tax Dragon
16th Aug 2019 09:48

Micawber do you mind telling us how long it was between the purchase of the initial cask and its being transferred to the company?

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Replying to Tax Dragon:
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By Micawber
16th Aug 2019 11:21

The initial casks were purchased in June 2009, then nothing further until 2012. The company was formed in 2013 and the initial transfer to the company was in 2018. Not sure if that helps.
However please see my reply at 11.12 today to whitevanman above: joint election under S167 CTA 2009?

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By Tax Dragon
16th Aug 2019 11:51

Ref your eureka moment, even if that's right (I haven't looked) you still need something to defer the capital gain.

There should be something, else you potentially have double tax and that doesn't feel right. But I'm stuck to think what stops the double charge, unless you take the full MV figure into the sole trading account.

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Replying to Tax Dragon:
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By Micawber
16th Aug 2019 11:58

But if this is a straightforward sale of trading stock, capital gains shouldn't come into it, should it? No longer personal assets transferred if the argument holds that they were acquired in the nature of trade? And then sold.

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Replying to Micawber:
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By Tax Dragon
16th Aug 2019 12:15

Is trading stock exempt from CGT? It should be (as you say), but is it?

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Replying to Tax Dragon:
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By Micawber
16th Aug 2019 12:39

I think it should be: profit on sale of trading inventory should be subject to income tax, not CGT. And it must be either or, can't be both, that would be wrong.

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Replying to Micawber:
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By Tax Dragon
16th Aug 2019 12:44

But you agreed my "summary" statement above, which says otherwise.

I agree with you that the law should enable either a deferral of the gain, or provide an exemption for trading stock. I'm not aware it does either. (I'm hoping someone will educate us both here!)

But a disposal is a disposal. One thing I do know about CGT... it applies to disposals.

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Replying to Tax Dragon:
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By whitevanman
16th Aug 2019 16:04

You are quite correct. CGT applies whenever a chargeable asset is disposed of and in that connection, pretty much any asset is, in the first instance, chargeable. There are notable exceptions specified (such as wasting assets, chattels etc) but the bit that "saves" the client is (as stated much earlier in the thread) the exclusion of sums brought into the charge to income tax. In that connection, the transfer of an asset at anything other than OMV will often result in OMV being substituted in the tax computation. However, legislation sometimes provides for relief and Micawber has identified above, two such examples. These generally work by starting from the premise that OMV should be used but then if an election can be and is made, the stock is treated as though it had been sold in the ordinary course of trade and that forestall any CGT arguments.
The purpose of the relief is to ensure unrealised profits are not taxed as explained at BIM 33480. I know HMRC can be sneaky at times but to grant a relief only to tax the relieved gain as CGT would be unusually sneaky even for them!
So, if the client is treated as acquiring stock from time to time, accounts covering the period from say 2009 to 2018 would reflect the purchase price and any costs incurred. Without sales, it is probable the costs would give rise to losses. If the trade is then discontinued and stock transferred to the company at the right price, the relevant election could be made and hey presto, objective achieved. All profits will arise in and be taxed on the company. Or maybe someone knows better........

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Replying to whitevanman:
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By Tax Dragon
16th Aug 2019 16:35

It's not a question of sneak.

The issue is that the elections you refer to apply for income taxes. Unless something imputes them to the CGT code, or there are equivalent elections within the CGT code, the strict position is that there is a chargeable gain.

What you might be able to argue is that that gain will effectively be subject to tax as income within the company on a future sale... put that thought together with (I'm relying on memory ATM so I'll get this horribly wrong but...) is it s9 CTA 2009 maybe?? And there's a case...

But I'm not convinced and I don't have resources to hand to check the logic. Without an argument like this, or a more convincing one that hasn't yet been made in this thread, or some good old fashioned discretionary common sense from HMRC, I think the client is technically taxable.

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Replying to Tax Dragon:
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By Micawber
16th Aug 2019 18:02

Bear in mind that there is an election within the CGT code, namely S161(3). So there would seem to be the intention to allow relief for an unrealised gain or profit under both CGT and IT legislation, in certain circumstances.
As you say, the 'gain' will indeed be taxed by way of CT for the company (when realised),(as should be the case) so there is no loss to the Exchequer.
All of this now feels right (IMO) and as regards common sense from HMRC, well, they used to mostly accept what was reasonable (which I think this is) so....we'll see.
I'm hoping we've got there now.
Many thanks for your all your input, much appreciated.
I'm a pessimist too btw, as should we all be!

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Replying to whitevanman:
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By Micawber
16th Aug 2019 17:32

That's how I see it now, with the charge to income tax precluding a further charge to CGT. The unrealised (profit or gain) aspect is what drives the relief by way of election and I always felt there ought to be some relief available. And there's no doubt that, the more it's looked at, the more it looks as being in the nature of trade from the outset.
Many thanks for all your input here, much appreciated - and I hope that might be the final position now!

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By Tax Dragon
16th Aug 2019 23:17

One last Friday night question... then I'll shut up.

In your most recent post (18.02), you are still referring to s161(3).... do you think you will be advising your client to make an election under s161(3)?

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By Tax Dragon
23rd Aug 2019 17:59

This thread may have died, but I meant to put right the "from memory" comments in my reply to whitevanman on 16th Aug 2019 at 16:35, before I forget again. (There's an irony in there somewhere... or at least a lesson: don't rely on [my] memory.)

I said:

Tax Dragon wrote:

What you might be able to argue is that that gain will effectively be subject to tax as income within the company on a future sale... put that thought together with (I'm relying on memory ATM so I'll get this horribly wrong but...) is it s9 CTA 2009 maybe?? And there's a case...

I meant s4 CTA2009. The case I had in mind referred to s3 but I thought it might carry across. The point is that neither section explicitly restricts itself to tax charges on the company - so potentially both exclude tax charges on other people. Which would obviously be helpful in the whisky case. If it applied.

But it doesn't. The words "gains accruing to a company" in s4 banish that thought.

So, Micawber, whatever conclusions you had come to, at least I haven't disturbed them.

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Replying to Tax Dragon:
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By whitevanman
29th Aug 2019 11:04

I will respond even later!
I think the answer lies in what the legislation says (isn't that always the problem!) but equally, like you, I cannot find specific wording to say as much.
The rules are basically the same whether in CTA or ITTOIA so I will refer to the latter.
Ss175-180 deal with how you value stock on discontinuance. What S178(3) says is that, if an election is made," the value is taken to be" something other than what might be OMV (the appropriate, lower, figure).
The only way you get to your potential CG charge is by bringing in the OMV and saying that, as a lesser amount was included in the tax computation, the excess can be charged to CG.
This is where I think you have to take a leap of faith!
As said, the legislation says the valuation is taken to be a lower figure. It seems to have been worded that way specifically to avoid the problem you highlight and support for that is in BIM33480.
I would assume that, whilst not specifically stated, one cannot argue that the stock has different values for different taxes. Clearly HMRC seem to have that view and I suspect the courts would agree.

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Replying to whitevanman:
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By Tax Dragon
29th Aug 2019 12:02

I would hope that HMRC would exercise discretion(?) and not pursue a CGT liability, but were this to go to court I regret to say that I don't share your optimism on the outcome.

Your would-be argument founders on s173, which sets the context of your quotes above. It says that the value in question is for the purpose of calculating the profits of the trade. It would be lovely to be able to export the same value to TCGA and CGT, but the basis for doing so is not written. The court would have to be determined to find in the taxpayer's favour (it does happen) and would I think need to find a way of applying some sort of purposive argument to get the desired outcome.

To my mind the law is sadly clear here, so the court will have to make a leap of imagination (they're not great ones for faith) greater than I have managed, if it is to find favourably.

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Replying to Tax Dragon:
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By whitevanman
29th Aug 2019 13:06

Again I understand your points and am to some extent in agreement with you. However, I think you have to consider many wider questions about what is OMV, what is a Commercial transaction and how the legislation impacts these. The purpose of Ss175 et seq is to establish OMV for tax purposes and S178 in effect allows the parties to decide that. The purpose is to avoid taxing unrealised gains and as said before, I don't think anyone would consider it appropriate to frustrate the clear intention of parliament by using different values for different taxes.
To the extent that any comfort is required, one simply needs to read what HMRC say at BIM33480. They clearly regard the S178 value as applicable for all taxes and refer specifically to forestalling the CG problem (to which you refer). So, whether we believe there to be a possible issue, anyone working for HMRC is bound to follow the guidance and could not therefore advance the argument you raise. If they did, I very much doubt anyone further up the chain would support them in taking a case further.
Personally, I would be quite sanguine about it.

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Replying to whitevanman:
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By Tax Dragon
29th Aug 2019 13:40

Oh, personally I would be putting this in a white space not in a "I have CGT to pay" box, same as you. The only difference is that I'd have my fingers crossed a bit harder.

Btw, as I've said the purpose of Ss175 et seq is set out in s173. You can't fool the courts with comments about it being "for tax purposes" when the actual purpose is scoped out in the introductory section! Your BIM line is also weak - but all the OP needs is justification for the WSD approach, and maybe you've helped with that.

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Replying to Tax Dragon:
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By whitevanman
29th Aug 2019 21:45

Last post. Honest!
Have you seen what it says at CG14300 about the primacy of Income Tax decisions? I assume it derives from S284 TCGA but a brief reading of that left me as uncertain as ever!

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