In The First De Sales Limited Partnership and others v HMRC [2018] UKFTT 106 (28 February 2018) the FTT struck out an appeal on the ground that the appellants had no reasonable prospect of succeeding in establishing that large payments to employees were deductible.
The appellants were partnerships and limited liability partnerships who had entered into arrangements disclosed under DOTAS. They had all made significant payments as contractual consideration for specific individuals granting restrictive undertakings and they claimed to be entitled to deductions in relation to these payments.
HMRC considered that the payments were not deductible and it submitted that there was no reasonable prospect of the appellants establishing that the payments were deductible. HMRC therefore applied to strike out the appellants’ appeals.
HMRC contended that the appellants had provided little evidence (if any) to explain why such large payments in respect of restrictive undertakings given by employees...
