On purpose
Mandipa Soni examines the loan relationship unallowable purpose rule.
HMRC is increasingly testing the scope of such provisions, as evidenced recently by the First-tier Tribunal (FTT) decision Oxford Instruments UK 2013 Ltd v HMRC [2019] UKFTT 254, in which it was held that a loan entered into as a final step in a debt restructuring had an ‘unallowable purpose’.
This article explores the unallowable purpose rule and its wider application to companies and advisers in determining the scope of tax relief available.
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