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Armajaro Holdings Ltd v HMRC

In Armajaro Holdings Ltd v HMRC (TC02960 – 16 October) Armajaro (AHL) a company had set up a limited liability partnership (AAM) with individual members. AHL had subsequently purchased the partnership interests of three members.

The issue was whether intangibles relief was available under FA 2002 Sch 29 in respect of the acquisitions. This would only be the case if either AAM was tax transparent and therefore AHL had a direct interest in the goodwill of AAM or AHL’s interest qualified as ‘an interest in partnership property that is an intangible asset’.

The First-tier Tribunal found that ICTA 1988 s 118ZA(1) only deemed an LLP to be transparent for corporation tax purposes and so AAM was not transparent for Sch 29 purposes.

On the second point the tribunal relied on expert evidence provided by a chartered accountant which suggested that as AAM was an LLP ...

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