The “purpose” question in the Transactions in Securities rules: Taxpayer win in the Upper Tribunal.

In its decision in Osmond and Allen v HMRC, the Upper Tribunal reversed the decision of the First-tier Tribunal below, and found that where a person has a purpose of obtaining a CGT benefit by dint of EIS relief, such a purpose does not inextricably lead to them having an offending income tax advantage purpose within the TiS rules. The Upper Tribunal applied the Court of Appeal decision in Blackrock and recognised the need to distinguish between the effect and purpose of a transaction.

Jonathan Peacock KC and Edward Hellier acted for the Taxpayers.