KNIGHTS DEVELOPMENTS LIMITED v THE COMMISSIONERS FOR HIS MAJESTY’S REVENUE AND CUSTOMS [2026] UKUT 00329 (TCC)
Upper Tribunal Tax and Chancery decision of MR JUSTICE NICHOLAS THOMPSELL and JUDGE SWAMI RAGHAVAN on 25 August 2026
Read full decision:
CORPORATION TAX – double taxation arrangements between the United Kingdom and the Isle of Man – Isle of Man resident company carrying on trade of acquiring, developing and selling land in the United Kingdom – profits accepted to be trading profits and income in nature under domestic law – whether profits fall within Article 6 (“income from immovable property”) of the 2018 United Kingdom-Isle of Man Agreement and corresponding provisions of the 1955 Agreement as amended in 2016 – meaning of “income derived from immovable property” – relationship between Article 6(1), (3) and (4) – relevance of OECD Commentary, reservations and foreign authorities – whether Article 6 limited to income derived from use or exploitation of property – held: Article 6 not so limited and profits from development and sale of land fell within Article 6 – whether profits alternatively fell within Article 13 (“gains derived from the alienation of immovable property”) – meaning of “gains” in treaty context – relevance of Article 3(2), Article 7(4) and Royal Bank of Canada v HMRC – held: Article 13 concerned with capital gains and not trading profits – appeal dismissed.