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13 September 2007 / Tim Crosley , Michael Walsh
Issue: 7288 / Categories: Features , Tax
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Bad pennies

Tim Crosley and Michael Walsh analyse the implications of HMRC’s defeat in Sempra

“Legal rules which are not soundly based resemble proverbial bad pennies: they turn up again and again.” The bad penny to which Lord Nicholls was referring was the “negative attitude of English law to awards of compound interest on claims for debts paid late” in Sempra Metals Ltd v IRC [2007] UKHL 34, [2007] All ER (D) 294 (Jul). In a complex and lengthy judgment where all five law lords had their say, the majority refused the appeal of HM Revenue & Customs (HMRC). The origins of the claim lie in the unlawful levying of advance corporation tax (ACT) by the UK government, but the decision is undoubtably of more general significance.

BACKGROUND

The UK required UK companies paying a dividend to pay ACT to HMRC from 1973 until its abolition in 1999. As the name suggests, ACT was an advance payment of corporation tax. ACT paid could be set off against the UK company’s normal liability to pay corporation

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MOVERS & SHAKERS

Flint Bishop—Charlotte Harris

Flint Bishop—Charlotte Harris

Sheffield expansion continues with appointment of commercial property partner

Browne Jacobson—Paul Duggan

Browne Jacobson—Paul Duggan

Browne Jacobson strengthens banking and finance practice with latest partner appointment Paul Duggan

Ward Hadaway—Chris Piggott

Ward Hadaway—Chris Piggott

Employment partner joins Ward Hadaway

NEWS
The Law Society RFC Festival of Sport returns next month, bringing together legal and financial services professionals for one of the sector’s largest annual sporting events
Legal aid deserts leave almost one in four without adequate access to justice
The Solicitors Regulation Authority (SRA) has warned solicitors and law firms that using artificial intelligence does not alter their professional obligations, amid concerns over inaccurate legal material and client confidentiality
From forgotten interest claims to case-management appeals, a string of procedural developments offers useful—and occasionally cautionary—lessons for practitioners

Jonathan Fisher KC highlights that it now accounts for around 40% of criminal offences, with roughly 70% involving technology, and argues that the UK cannot simply prosecute its way out of the problem. Detection, investigation and prosecution all require improvement, while different fraud types demand tailored responses.

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