Revenue loses case worth £200m
The Inland Revenue has suffered another blow with the loss of a Court of Appeal case into wrongful payments of advanced corporation tax that could eventually cost the department in excess of £200m.
Link: Revenue backs out of IR35 dispute
The judgement held that the Revenue had wrongfully levied ACT against companies with a parent resident in another EU state, so contravening Article 43 of the EC treaty.
The decision opens the way for all UK companies with EU or European Economic Area parents to seek relief for past ACT payments.
Peter Cussons, international tax partner at PricewaterhouseCoopers, which was advising Pirelli in the test case said the decision was a ‘welcome’ one. ‘Once again the courts are acknowledging a taxpayer’s EC treaty argument the result of which could lead to claims in excess of £200m.’