It is a well-established feature of previous judgements that a fine imposed to punish an organisation should not be treated as tax deductible – the tax relief secured would effectively share out the burden of the punishment with the rest of the taxpaying community.
Which is why the First Tier Tribunal (FTT) decision, allowing McLaren racing to deduct a £32m fine for being in possession of documents belonging to Ferrari, was seemingly out of step with this point of view.
HMRC appealed the FTT ruling and the Upper Tribunal reversed the decision.
In some respects, this addresses issues of common sense as well as the law. If the FTT ruling had held, would we have seen footballers claiming tax relief on fines for bad behaviour? Or tennis players for swearing?
- Mini-Budget 23 September 2022 - September 23, 2022
- Businesses face rebranding following Queens death - September 22, 2022
- Prepare your business for the next big challenge - September 20, 2022
- We need to do things differently says Chancellor - September 16, 2022
- Tough new rules to protect against cyber attacks - September 13, 2022
- Energy bill support for families and businesses - September 12, 2022
- Bungling bundling bank to repay businesses - September 6, 2022
- Tax Diary September/October 2022 - September 1, 2022