In N Pike v HMRC (TC01151 – 7 June) an individual (P) purchased a newly incorporated company on 28 March 2000.
On 31 March 2000 he paid £6 000 000 for loan stock in the company. On 5 April 2000 he transferred the loan stock to a newly created trust of which he and his wife were trustees.
He subsequently submitted a tax return claiming that he had made a loss of more than £3 400 000 on a relevant discounted security.
HMRC rejected the claim and P appealed contending that the loan stock had had a market value of £2 600 000 when he transferred it to the trust.
The First-tier Tribunal dismissed his appeal finding that ‘the transactions at issue in this appeal were part of a scheme of tax avoidance’ and that P had...
