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HMRC internal manual

Business Income Manual

Meaning of trade: general: question of fact for Tribunal

The question whether a trade exists is primarily a question of fact. The function of the appeal Tribunal is to find the primary facts and decide the ‘trade’ issue on the basis of those facts.

The conclusion that there is, or is not, a trade is itself a finding of secondary fact from the primary facts. The Tribunal decision on the existence of a trade cannot normally be upset because an appeal to the Upper Tribunal or the courts can only succeed on a point of law. However it is a question of law whether there is any evidence to justify the conclusion of fact. The courts can therefore over turn the Tribunal’s decision if:

  • the Tribunal acted without evidence, or
  • it could not reasonably have reached the decision from its finding of primary facts.