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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: dual motive transactions

Transactions that are ‘equivocal’ may also be dual motive transactions. A dual motive transaction is a transaction entered into with two objects. An example would be an acquisition of land both to provide accommodation for an existing trade and for eventual development and resale at profit. It would be for the Tribunal to decide as a question of fact in such circumstances whether one of those motives was a trading motive and, if so, to what extent it coloured the whole transaction as being, in essence, a trading transaction. Nourse LJ’s comments in Kirkham v Williams [1991] 64TC253 are relevant.