The Treasury has denied a Freedom of Information Act request from the
Chartered Institute of Taxation for more information on the government’s view on
the Manninen case.
The institute is seeking to resolve the longstanding uncertainty over the
case, which relates to the entitlement of British citizens to tax credits on
dividends earned from companies based in the EU, but not in the UK.
The case established that a Finnish shareholder was entitled to the same
credits for foreign, EU-based companies paying dividends, just as he was to
those from companies based in Finland. The similarity of UK tax rules to those
in Finland has raised hopes that taxpayers could claim similar dividend credits,
both in future and retrospectively.
‘We applied under the FOI Act to find out what [the Treasury’s] policy was
and specifically what advice it had received,’ said John Dewhurst, chairman of
the institute’s EU and human rights working group.
‘It refused to give us the information under the Act as it wasn’t a case of
facts, it was a case of policy and thus it was not obliged to give the
information to us,’ he added.
The CIOT is currently deciding what to do next, whether to pursue a challenge
to the claim or simply to wait until a test case comes along for clarification.
Advisers are telling clients to claim for the credits anyway, in the
expectation that HM Revenue & Customs may seek to challenge the claims in
court. A test case is expected to emerge as the claims go through.
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