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HMRC internal manual

Business Income Manual

Capital/revenue divide: tax cases and summing up: table of tax cases referred to

Alphabetical order by names of the party

The table below identifies the:

  • point at issue,
  • names of the parties,
  • BIM page(s), and
  • Tax case reference,
  • for each of the cases referred to in the guidance material on the capital/revenue divide.
Point at issue Names of the parties BIM page(s) Tax case reference
Payment for surrendering rights A Consultant v HM Inspector of Taxes BIM35535, BIM35600 SPC180
Removing a commission agent Anglo-Persian Oil Company Ltd v Dale BIM35505, BIM35625, BIM35901, BIM35815 16TC253
Commission for a guarantee Ascot Gas Water Heaters Ltd v Duff BIM35580 24TC171
Restrictive covenant Associated Portland Cement Manufacturers Ltd v Kerr BIM35510, BIM35595 27TC103
Contribution to establish a pension fund Atherton v British Insulated & Helsby Cables Ltd BIM35010, BIM35320, BIM35401, BIM35505, BIM35550, BIM35590, BIM35625, BIM35901 10TC155
Compensation for loss of agency agreement Barr, Crombie & Co Ltd v CIR BIM35530, BIM35535 26TC406
Costs of loan finance Beauchamp v F W Woolworth plc BIM35580, 61TC542
Exclusivity tie Bolam v Regent Oil Co Ltd BIM35550, BIM35555, BIM35810, BIM35901 37TC56
Annual receipts for sharing know-how and secret processes for 10 years. British Dyestuffs Corporation (Blackley) Ltd v CIR BIM35705, BIM35720 12TC586
Replacement of football stand, capital or revenue? Brown v Burnley Football and Athletic Co Ltd BIM35435, BIM35485 53TC357
Accounting treatment inconsistent with the true facts BSC Footwear Ltd v Ridgway BIM35030 47TC495
Doctrine of the ‘entirety’ Bullcroft Main Collieries Ltd v O’Grady BIM35440, BIM35467 17TC93
Damage to land Bullcroft Main Collieries Ltd v O’Grady BIM35425 17TC93
Surrender of onerous lease Bullrun v CIR BIM35010, BIM35625 SPC248
Compensation for delay in overhauling ship Burmah Steam Ship Co Ltd v CIR BIM35427, BIM35600 16TC67
Changing a partnership structure C Connelly & Co v Wilbey BIM35525 65TC208
Periodical payments linked to sales CIR v 36/49 Holdings, Ltd (In Liquidation) BIM35040, BIM35310 25TC173
Right to deposit material CIR v Adam BIM35305, BIM35315, BIM35901 14TC34
Gas pipes, repair or capital? CIR v Auckland Gas BIM35435, BIM35440, BIM35445, BIM35460, BIM35470 73TC266
Dairy herd Conversion scheme CIR v Biggar BIM35600 56TC254
Varying a company’s charter CIR v Carron Company BIM35301, BIM35320, BIM35505, BIM35565, BIM35901 45TC18
Legal analysis overrides the accounts as prepared CIR v Gardner Mountain & D Abrumenil Ltd BIM35030, BIM35210 29TC69
Share of profits paid for three years to retiring partner CIR v Hogarth BIM35315 23TC491
Share of profits paid for three years to buy out partner’s interest CIR v Ledgard BIM35315 21TC129
Periodical payments to finance a literary work CIR v Mallaby-Deeley and Another BIM35310, BIM35315 13TC153
Payment to another company to refrain from production CIR v Nchanga Consolidated Copper Mines Ltd BIM35510, BIM35635, BIM35901 Privy Council
Liabilities assumed on purchase of business CIR v New Zealand Forest Research Institute BIM35655 72TC628
Purchase of growing crop CIR v Pilcher BIM35410, BIM35901 31TC314
Lump sum receipt for know-how and services Coalite & Chemical Products Ltd v Treeby BIM35715 48TC171
Cost of pit sinking Coltness Iron Co v Black BIM35401, BIM35701, BIM35901 1TC287
Reverse premium Commissioner of Inland Revenue v Wattie & Lawrence BIM35625 72TC639
Alterations as a result of changed techniques Conn v Robins Bros. Ltd BIM35455, BIM35460, BIM35480 43TC266
Payment to previous owner’s creditors to secure supplies Cooke v Quick Shoe Repair Service BIM35540 30TC460
Cancellation of lease of an unprofitable branch Cowcher v Richard Mills and Company Ltd BIM35625 13TC216
Getting rid of a business manager Croydon Hotel & Leisure Co Ltd v Bowen BIM35535 SPC101
Exam fees, capital or revenue? Dass v Special Commissioner and others BIM35660 [2006] EWHC 2491 (Ch)
Damages awarded to underwriters against managing agents Deeny & others v Gooda Walker Ltd & others BIM35600 68TC458
Royalties for publishing war diaries Earl Haig’s Trustees v CIR BIM35701 22TC275
Unsuccessful planning application ECC Quarries Ltd v Watkis BIM35210, BIM35320, BIM35625 51TC153
Payment for additional capital European Investment Trust Co Ltd v Jackson BIM35580 18TC1
Lump sum receipt for sale of secret processes and other information to foreign government Evans Medical Supplies Ltd v Moriarty BIM35705, BIM35710 37TC540
Farm drive resurfacing, capital or revenue? G Pratt and Sons v HMRC BIM35485 [2011] UKFTT 416 (TC)
Lump sum received by authoress for sale of copyright Glasson v Rougier BIM35725 26TC86
Compensation for restriction on trade assets Glenboig Union Fireclay Co Ltd v CIR BIM35010, BIM35600 12TC427
Sale of fixed or current assets? Gloucester Railway Carriage and Wagon Company Ltd v CIR BIM35429 12TC720
Purchase of mine ‘tailings’ Golden Horseshoe (New) Ltd v Thurgood BIM35405, BIM35901 18TC280
Payments for right to enter and diminution of value of land H J Rorke Ltd v CIR BIM35401 39TC194
Demutualisation costs Halifax Building Society v Davidson BIM35645 SPC 238
Opposing a patent renewal Hallstroms Proprietary Ltd v The Federal Commissioner of Taxation BIM35045, BIM35430, BIM35455, BIM35460, BIM35645 Australian Case
Payment to fund to enable staff to buy shares in company Heather v P-E Consulting Group Ltd BIM35035, BIM35210, BIM35901, BIM35910 48TC293
Payment for a monopoly by instalments Henriksen v Grafton Hotel Ltd BIM35620 24TC453
Claim to deduct a provision for future rents payable on vacant premises Herbert Smith v Honour BIM35030, BIM35210 72TC130
Payment to actor to not appear in films for a period Higgs v Olivier BIM35600 33TC136
Railway track repair, capital or revenue? Highland Railway Co v Balderston BIM35445, BIM35475 2TC485
Lifetime of implements Hinton v Maden & Ireland Ltd BIM35415, BIM35901 38TC391
Lump sum received by film writer to terminate contract Household v Grimshaw BIM35730 34TC366
Lump sum received by author for sale of copyright Howson v Monsell BIM35730 31TC529
Purchase of oil Hughes v British Burmah Petroleum Co Ltd BIM35401 17TC286
Incorporating a new company J B Kealy v O’Mara (Limerick) Ltd BIM35615 Irish Case
Sale of fixed or current assets? J Bolson & Son, Ltd v Farrelly BIM35429 34TC161
Dilapidations under a lease Jackson v Laskers Home Furnishers Ltd BIM35620 37TC69
Lump sums derived from transfer of manufacturing know-how Jeffrey v Rolls-Royce Ltd BIM35710 40TC443
Shares received for know-how John & E Sturge Ltd v Hessel BIM35720 51TC183
Payment for benefit of contracts with supplier John Smith v Moore and Son BIM35010, BIM35655 12TC266
Provision for maintenance Johnson v Britannia Airways Ltd BIM35210 67TC99
Compensation for preventing ‘ribbon development’ Johnson v W S Try Ltd BIM35600 27TC167
Loss of one of several agency agreements Kelsall Parsons & Co v CIR BIM35530 21TC608
Open cast mine Knight v Calder Grove Estates BIM35401 33TC447
Asset bought in defective condition Law Shipping Co Ltd v CIR BIM35450, BIM35455 12TC621
Money injected into subsidiary as a condition of sale Lawson v Johnson Matthey plc BIM35650, BIM35901 65TC39
Compensation for loss of use of jetty London & Thames Haven Oil Wharves Ltd v Attwooll BIM35600 43TC491
Alterations and improvements to building Lurcott v Wakeley and Wheeler BIM35435 1KB905
Lump sum received by author for sale of copyright. Expenses incurred whilst non-resident Mackenzie v Arnold BIM35730 33TC363
Obtaining release from mining lease Mallett v The Staveley Coal & Iron Co Ltd BIM35625, BIM35901 13TC772
Doctrine of the ‘entirety’ Margrett v The Lowestoft Water & Gas Co Ltd BIM35465 19TC481
Sharkey v Wernher not applicable to author’s rights Mason v Innes BIM35735 44TC326
Premium to renew lease McTaggart v B & E Strump BIM35810 10TC17
Are wallpaper pattern books plant? McVeigh v Arthur Sanderson & Sons Ltd BIM35810 45TC273
Unsatisfactory employee Mitchell v B W Noble Ltd BIM35590 11TC372
Anti nationalisation campaign Morgan v Tate & Lyle Ltd BIM35540, BIM35570 35TC367
Receipts for grant of licences and non-competition agreements Murray v Imperial Chemical Industries Ltd BIM35710 44TC175
Lump sum receipts for transfer of know-how Musker v English Electric Co Ltd BIM35715 41TC556
Asset bought in defective condition Odeon Associated Theatres Ltd v Jones BIM35450 48TC257
Size and importance of the work Phillips v Whieldon Sanitary Products Ltd BIM35440, BIM35485 33TC213
Railway track, repair or capital? Rhodesia Railways Ltd v Collector of Income Tax, Bechuanaland Protectorate BIM35440, BIM35570 [1933] AC 368
Payment in lieu of surface restoration Robert Addie & Sons’ Collieries Ltd v CIR BIM35425 8TC671
Waste dump reverted to the land Rogers v Longsdon BIM35405 43TC23
Tipping space Rolfe v Wimpey Waste Management Ltd BIM35605, BIM35625, BIM35901 62TC399
Acquisition cost of a business Royal Insurance Company v Watson BIM35655 3TC500
Abandonment expenditure RTZ Oil & Gas Ltd v Elliss BIM35420, BIM35625 61TC132
The ‘entirety’ is the premises Samuel Jones & Co (Devonvale) Ltd v CIR BIM35440, BIM35467 32TC513
Compensation for withdrawal of planning permission Shadbolt v Salmon Estate (Kingsbury) Ltd BIM35600 25TC52
Compensation for cancellation of order to build ships Short Bros Ltd v CIR BIM35600 12TC955
Sum paid to indemnify assignee of lease for dilapidations Southern Counties Agricultural Trading Society Ltd v Blackler BIM35630 SPC
Factual assumptions insufficiently reliable Southern Railway of Peru Ltd v Owen BIM35030, BIM35210 36TC602
Preserving title to assets Southern v Borax Consolidated Ltd BIM35510, BIM35540, BIM35570 23TC597
Exclusivity tie Strick v Regent Oil Co Ltd BIM35015, BIM35040, BIM35045, BIM35205, BIM35505, BIM35560, BIM35701, BIM35810, BIM35815, BIM35901 43TC1
Broker’s commission Texas Land & Mortgage Co v Holtham BIM35580 3TC255
Liabilities assumed on purchase of business The City of London Contract Corporation Ltd v Styles BIM35655 2TC239
Shares received for know-how Thomsons (Carron) Ltd v CIR BIM35720 51TC506
Application of accountancy standards to leasing Threlfall v Jones Gallagher v Jones BIM35201, BIM35810 66TC77
Gas pipes, repair or capital? Transco plc v Dyall BIM35445, BIM35470 SPC310
Varying a lease Tucker v Granada Motorway Services Ltd BIM35320, BIM35420, BIM35625, BIM35901 53TC92
Establishing a rubber plantation Vallambrosa Rubber Company Ltd v Farmer BIM35305 5TC529
Compensation for terminating an agreement Van den Berghs Ltd v Clark BIM35020, BIM35035, BIM35530, BIM35535, BIM35585, BIM35625, BIM35730, BIM35901 19TC390
Getting rid of an onerous contract Vodafone Cellular & Others v Shaw BIM35530, BIM35585, BIM35625, BIM35901 69TC376
Doctrine of the ‘entirety’ W Thomas and Co Pty Ltd v Federal Commissioner of Taxation BIM35430 Australian case
Author’s receipts from sale of working papers, etc Wain’s Executors v Cameron BIM35735 67TC324
Buying out a potential rival Walker v The Joint Credit Card Co Ltd BIM35510, BIM35540, BIM35595,BIM35635, BIM35901 55TC617
Payment to change existing business structure or asset Watney’s London Ltd v Pike BIM35545 57TC372
Dairy herd Conversion scheme White v G & M Davies BIM35600 52TC597
Varying terms of a loan Whitehead v Tubbs (Elastics) Ltd BIM35575 57TC472
Treatment of interest paid Wilcock v Frigate Investments Ltd BIM35201 55TC530
No deduction for ‘notional’ repairs William P Lawrie v CIR BIM35465 34TC20
Shares received in exchange for know-how and non-competition agreement Wolf Electric Tools Ltd v Wilson BIM35710, BIM35720 45TC326