Supreme Court hands down decision in HMRC v Fisher on transfer of assets abroad regime

In the decision of Commissioners for His Majesty’s Revenue and Customs (Respondent) v Fisher and another (Appellants) [2023] UKSC 44, handed down on 21 November 2023, the Supreme Court has provided important guidance about the identification of the “transferor” for the purpose of the transfer of assets abroad provisions, first introduced into the UK tax code in the Finance Act 1936 and now contained in sections 714 to 751 of the Income Tax Act 2007.

The taxpayers were each minority shareholders in a UK betting company, which had transferred its business to a company resident in Gibraltar, and had been charged by HMRC to UK income tax on the profits of the Gibraltar company in proportion to their shareholdings under section 739 of the Income and Corporation Taxes Act 1988 and section 720 Income Tax Act 2007.

The Supreme Court confirmed that for an individual to be charged to tax under the charging provision, they must properly be regarded as the individual who transferred abroad the assets giving rise to the income which that individual is then deemed to receive within the UK.

The Court went onto conclude that that the taxpayers, as minority shareholders, were not singly or collectively the transferors of the business for the purpose of section 739 and were not caught by the charge.

Emilia Carslaw (led by David Ewart KC, Barbara Belgrano and Ben Elliott of Pump Court Tax Chambers and Brendan McGurk of Monckton Chambers) acted for HMRC.

For a copy of the judgment, please click here.