Hargreaves Lansdown (HL) at the First-tier Tribunal has defeated HMRC’s claim for withholding tax at 20% on platform ‘loyalty payments’ made to its customers, largely pre-2014. The case throws an interesting light on the nature of ‘annual payments’ and also of platform agreements. The decision that no withholding tax applied, which HMRC has appealed, rests on the tribunal’s reading of HL’s marketing materials and investor terms and conditions. Providers still making substantial ‘loyalty payments’ – perhaps limited in number after reforms in 2013 and 2014 – may consider reviewing their investor-facing material in light of the decision.
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