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CJEU judgment in FII GLO ‘an expensive blow’ for HMRC

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The CJEU issued its judgment following third preliminary reference in the franked investment income group litigation order (FII GLO) on 12 December 2013. The judgment determined unreservedly that the UK’s introduction of FA 2004 s 320 (which sought to limit the length of time over which claims based on mistake of law could be made) was unlawful, offending EU principles of effectiveness, legal certainty and legitimate expectation.

Chris Morgan, partner at KPMG, said: ‘This result is potentially an expensive blow to HMRC. Many of the claimants in the FII GLO have lodged claims for repayments of tax that run back until the beginning of the advance corporation tax regime in 1973.’