In Mourne Properties v HMRC [2016] UKFTT 258 (19 April 2016) the FTT found that units held by the company in a fund did not form part of the company’s trading stock (CTA 2009 s 163(1)).
Mourne Properties challenged HMRC’s decision that units in a fund were an investment and therefore should not be treated as part of the company’s trading stock.
The FTT first noted that the treatment of the purchase of the units in the company’s accounts – as part of its stock and not as an investment – was not determinative. The company’s trading stock at the time of the purchase had been wholly composed of property located in Northern Ireland which the company owned and which it could sell dispose of or deal with entirely as it wished. By contrast the company had no power to deal with the building owned...
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