In S Fry v HMRC [2017] UKFTT 158 (9 February 2017) the FTT found that a taxpayer who had claimed CGT relief in circumstances where he was clearly not entitled had been careless.
Mr Fry was the sole shareholder and director of KXDNA and loaned over £9m to it in 1999. In 2004 a second investor was brought in and Mr Fry’s loan was converted into shares. Finally in 2004 KXDNA agreed to waive a loan owed to it by an associated company KX Gym amounting to over £7m. Mr Fry’s advisor suggested that the waver gave rise to a personal capital loss as it had come from funds he had loaned to the company ‘way back’.
Mr Fry therefore claimed relief from CGT under TCGA 1992 s 253 in his tax return. HMRC disallowed the claim and issued an assessment...
