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HMRC internal manual

Business Income Manual

HM Revenue & Customs
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Measuring the profits (particular trades): land: trading transactions: approach

Cases involving land transactions require an investigative approach. When looking critically at a transaction you should:

  • hold a meeting at an early stage to establish:

    • the history of the transaction and the relevant background detail;
    • the purchaser’s intention at the time of acquisition in the light of all the circumstances, bearing in mind that the person concerned may be required to give evidence regarding that intention before the Tribunal;
  • obtain copies of all the related correspondence, sales literature, legal documents etc;
  • critically review all assertions in the light of the evidence available;
  • form a view of the nature of the transaction only after the foregoing review.

In arguing your case you should normally use decided cases as a source of principle and not as a source of facts for comparison with those in your case. This is because what should determine your approach is the application of correct principles to the specific facts of the case.