The Upper Tribunal in HMRC v BlueCrest Capital Management (UK) LLP rejected HMRC’s restrictive (from a taxpayer perspective) interpretation of the conditions for the salaried members rules to apply. In particular, ‘significant influence’ is not limited to managerial influence over all the affairs of the LLP’s business. The case also highlighted the need for LLPs to retain appropriate evidence to support any conclusion that the rules do not apply to a member. Taxpayers that have based their approach to salaried members rule compliance on HMRC’s overly-restrictive guidance, may, subject to any successful HMRC appeal, consider using different arrangements.
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The Upper Tribunal in HMRC v BlueCrest Capital Management (UK) LLP rejected HMRC’s restrictive (from a taxpayer perspective) interpretation of the conditions for the salaried members rules to apply. In particular, ‘significant influence’ is not limited to managerial influence over all the affairs of the LLP’s business. The case also highlighted the need for LLPs to retain appropriate evidence to support any conclusion that the rules do not apply to a member. Taxpayers that have based their approach to salaried members rule compliance on HMRC’s overly-restrictive guidance, may, subject to any successful HMRC appeal, consider using different arrangements.
If you are not a subscriber, subscribe now to read this content.
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