In J Mazurkiewicz v HMRC (TC01643 – 6 January) an individual (M) had life savings of about £140 000. An accountant (L) persuaded him to ‘invest’ his savings by making a series of short-term loans to a company (DL) which traded in firearms and of which L was the managing director. DL (which subsequently went into liquidation) issued M with documents indicating that he had been credited with interest totalling £304 505 over three years all of which had been reinvested. HMRC issued assessments charging tax on this interest and M appealed.
The First-tier Tribunal reviewed the evidence in detail and allowed M’s appeal. Judge Nowlan held that ‘in reality the arrangement had all the attributes of a fluctuating loan where in cash terms the appellant would extract nothing from the arrangements unless and until the loans...
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