Revenue and Customs Commissioners v McQuillan and another

Income tax – Capital gains tax. Section 989 of the Taxation of Chargeable Gains Act 1992 started with the premise that 'ordinary share capital', as a defined term, included all of a company's issued share capital. There was no question of shares that carried no right to a dividend falling outside the definition of 'ordinary share capital'. Consequently, the First-tier Tribunal (Tax Chamber)(the FTT) had erred in deciding that a right to no dividend was a right to a dividend at a fixed rate for the purposes of that definition. The Upper Tribunal (Tax and Chancery Chamber) so held in allowing the Revenue and Customs Commissioners' appeal against the FTT's decision to allow the taxpayers' appeal against the rejection by the Revenue and Customs Commissioners of thei claim for entrepreneurs' relief in respect of their disposals of their ordinary shares in a company.

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