In Elborne & Ors v HMRC [2026] EWCA Civ 894, the Court of Appeal (CoA) agreed with previous tribunals that an Inheritance Tax (IHT) Home Loan scheme was valid. The value of a settled property within a deceased’s estate could be reduced for IHT purposes by an associated loan note as it was not caught by the relevant anti-avoidance legislation.
In Wensley Stock & Ors v Neal & Anor [2026] EWHC 1823 (Ch), the High Court (HC) found that royalty payments received by a family settlement established by the creator of Thomas the Tank Engine were capital rather than income for trust law purposes. The dispute centred on how royalties arising from an assigned right to receive publishing royalties should be treated within the trust, and whether trust law principles overrode the wording of the settlement.
Hello,
We have another bumper tax update this week, including poor scores for HMRC in the Charter Stakeholder Group’s annual report, with HMRC’s responsiveness receiving the lowest score of all charter standards for the third consecutive year. We also look at HMRC’s July Agent Update and several consultations, including one exploring the tax treatment of predevelopment costs.
The government is consulting on the tax treatment of predevelopment costs. The consultation seeks views and evidence from stakeholders on the types of costs incurred, their tax treatment under the current rules, and the impact this has on investment decisions.
HMRC have published their Agent Update for July 2026. We have summarised the key content, including the phased introduction of mandatory payrolling of Benefits In Kind (BIKs), changes to the taxation of carried interest and voluntary National Insurance Contributions (NICs), the launch of the Advance Tax Certainty Service, Making Tax Digital (MTD) developments, and a range of compliance deadlines and agent service updates.
HMRC have launched a consultation on 'Simplifying treaty relief from withholding tax on interest paid overseas'. Proposals include creating a new administrative process to make it easier and quicker for UK borrowers to obtain double tax treaty relief from withholding tax on overseas interest payments.
The government has published a response to its consultation 'Simplifying the taxation of offshore interest.' It confirms that while stakeholders broadly support efforts to simplify the rules, there are mixed views on moving to a calendar-year basis for taxing offshore interest. Further work will be undertaken before any legislative changes are made.
HMRC have launched a consultation on ‘Aligning the time limits for recovery of National Insurance Contributions (NICs) with Income Tax’. Proposals include bringing the time limits for assessing and recovering NICs into line with existing Income Tax rules, so that HMRC can apply a consistent framework across both taxes.
HMRC have released new guidance for individuals who wish to settle their disguised remuneration loan charge liability under new settlement terms. The guidance offers advice on the new settlement scheme and HMRC will write to those who are eligible to settle under the new terms.
The latest annual report from the Charter Stakeholder Group remains highly critical of HMRC's service performance, with scores either stagnant or deteriorating across most standards. Alongside poor scores for responsiveness and ease of use, the report highlights overwhelmingly negative feedback on Making Tax Digital (MTD).
