Chilcott v HMRC (and related appeal)

In Chilcott v HMRC (and related appeal) (CA – 6 December) two company directors exercised share options which they had been granted and realised substantial gains. One of the directors (C) declared the gain on his 2001/02 tax return but the other (G) did not. In October 2003 the company paid the Class 1 national insurance contributions arising from the exercise of the options. In 2006 the Revenue issued an amendment to C's return charging tax on the exercise of the options under what is now ITEPA 2003 s 222. They also issued a discovery assessment on G. Both directors appealed. The Special Commissioner dismissed their appeals and the Ch D and CA unanimously upheld this decision. The directors had failed to reimburse the company within the statutory time limit. Accordingly they were liable to tax.

Why it matters: ICTA 1988 s 144A(1) provided that certain...