Kwik-Fit Group Ltd & ors (appellants) v HM Revenue and Customs (respondent)
Wednesday 17 – Thursday 18 April 2024
By Appellant’s Notice filed on 3 March 2023, the Appellants appeal the Order of the Upper Tribunal (Tax Chamber) dated 25 November 2022.
Background (summary) – The Appellants are all part of the Kwik-Fit group of companies. In 2013, the Kwik-Fit Group undertook a reorganisation pursuant to which a number of new and existing intra-group receivables were assigned to Speedy 1 Limited.
HMRC took the view that the restructuring engaged the unallowable purpose regime and disallowed interest debit in relation to new loans and loans that had been assigned to Speedy and disallowed debits in relation to the increased interest payments on existing loans from Speedy to group companies.
The First Tier Tribunal (FTT) substantially agreed with HMRC except in the case of pre-existing loans assigned to Speedy where they said only the amount relating to the increased interest rate should be disallowed.
Both the Appellants and HMRC appealed to the Upper Tribunal which upheld the FTT decision.
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