The Court of Appeal in Burlington Loan Management DAC dismissed HMRC’s appeal, finding that merely offering a price in the knowledge that treaty benefits were available does not constitute ‘taking advantage’ of the treaty. The ruling provides a strong steer that future taxpayers should not rely on domestic case law when interpreting ‘main purpose’ in tax treaties and attempts a reconciliation of two apparently inconsistent UK main purpose cases.
The appeal in Burlington Loan Management DAC concerns whether anti-avoidance provisions in the UK-Ireland Double Tax Treaty applied to deny relief from withholding tax on interest. In this article for Tax Journal, we analyse the Court of Appeal’s reasoning on treaty abuse, ‘taking advantage’ and the future interpretation of principal purpose tests.
Read the full article in Tax Journal – non-subscribers can read for free by registering for an account with the Tax Journal website.
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