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HMRC internal manual

Business Income Manual

Meaning of trade: mutual trading and members clubs: tax cases referred to in guidance

Alphabetical order by names of the party

The table below identifies the:

  1. principle established
  2. names of the parties
  3. BIM page, and
  4. Tax case reference

for each of the cases referred to in the guidance material on the mutual trading and related issues.

Principle established Names of the parties Page Tax case reference
Crucial factor is nature of transactions Ayrshire Employers Mutual Insurance Association Ltd v CIR BIM24027, BIM24105  27TC331
No need for profit seeking motive Brighton College v Marriott BIM24045 10TC213
Deduction for costs saved by members’ services British Legion, Peterhead Branch, Remembrance and Welcome Home Fund v CIR BIM24475, BIM24775, BIM24794,BIM24796  35TC509
Distribution by Mutual concern in winding up Brogan v Stafford Coal & Iron Co Ltd BIM24550, BIM24600  41TC305
Apportionment of expenses Carlisle & Silloth Golf Club v Smith BIM24210, BIM24360, BIM24460, BIM24465, BIM24470, 6TC48 & 198
‘Not for profit’ does not preclude trading CIR v Hyndland Investment Co Ltd BIM24045 14TC
Whether trading CIR v Livingston & Others BIM24045 11TC538
Difference between proprietary and members’ club CIR v Stonehaven Recreation Ground Trustees BIM24210 15TC419
Is mutual insurance a trade? CIR v The Cornish Mutual Assurance Co Ltd BIM24040, BIM24100, BIM24155  12TC841
Difference between proprietary and members’ club CIR v The Eccentric Club Ltd BIM24210 12TC669
  Dublin Corporation v M’Adam BIM24030 2TC387
Bulk buying group trading as principle English & Scottish Joint Co-operative Wholesale Societies Ltd v The Commissioners of Agricultural Income Tax, Assam BIM24786, BIM24788  1948 19AC405
Whether trading Erichsen v Last BIM24045 4TC422
Contributors may come and go Faulconbridge v National Employers’ Mutual General Insurance Association Ltd BIM24105, BIM24110  33TC103
Control of a members’ club Fletcher v ITC BIM24235 1972AC414
Payments to trade protection associations Grahamston Iron Co v Crawford BIM24805 7TC25
Municipal water supply Harris v Corporation of the Burgh of Irvine BIM24155 4TC221
Destination of profits has no bearing on assessibility Hutchinson & Co (Publishers) Ltd v Turner BIM24470 31TC495
Surplus must go back to contributors and no one else Jones v The South West Lancashire Coal Owners’ Association BIM24110, BIM24115, BIM24410  11TC790
The practicalities of S54 Corporation Tax Act 2009 and S34 Income Tax (Trading and Other Income) Act 2005 Korner v CIR BIM24460 45TC
  Last v The London Assurance Corporation BIM24035 2TC100
Effect of shareholding Liverpool Corn Trade Association Ltd v Monks BIM24160, BIM24405  10TC442
Payments to trade protection associations Lochgelly Iron and Coal Co Ltd v Crawford BIM24805 6TC267
The practicalities of S54 Corporation Tax Act 2009 and S34 Income Tax (Trading and Other Income) Act 2005 McLaren v Mumford BIM24460 69TC
What is mutual trading Municipal Mutual Insurance Ltd v Hills BIM24015, BIM24025, BIM24105, BIM24665  16TC430
Co-operative dividends Pope v Beaumont BIM24560 24TC78
Whether trading Ransom v Higgs BIM24045 50TC1
Members must control the common fund Revesby Credit Union v The Commissioner of Taxation for the Commonwealth of Australia BIM24120 112CLR564
Trading is not a question of motive Royal Agricultural Society of England v Wilson BIM24045 9TC
The categories of income are exclusive Salisbury House Estates Ltd v Fry BIM24040 15TC266
Can a taxpayer trade with themselves Sharkey v Wernher BIM24035 36TC275
Co-operative dividend satisfied by shares Staffordshire Egg Producers Ltd v Spencer BIM24560 41TC131
  Styles v New York Life Insurance Company BIM24035, BIM24040, BIM24100, BIM24155, BIM24160, BIM24210, BIM24788  2TC460
Members’ club only liable on profits from non-members The National Association of Local Government Officers v Watkins BIM24210 18TC499
Deductibility of trader’s payments to a mutual trader Thomas v Richard Evans & Co Ltd BIM24950 11TC790
Control of a members’ club Westbourne Supporters of Glentoran v Brennan BIM24225, BIM24120  SPC22
The practicalities of S54 Corporation Tax Act 2009 and S34 Income Tax (Trading and Other Income) Act 2005 Wildbore v Luker BIM24460 33TC46