United Kingdom Tax Tribunal Clarifies Income Tax, VAT Liabilities From Continued Business Activities After Sale

The United Kingdom First-Tier Tax Tribunal May 6 issued a decision in Case No. TC09872, clarifying income tax and VAT liabilities from continued business activities after a sale. The taxpayer, a chartered accountant, claimed that he sold his business in 2003 and acted as a subcontractor while living abroad. The Tax Agency assessed income tax and VAT based on continued business operations and underreported income, using bank statements, invoices, and client evidence. On appeal, the Tax Tribunal found that: 1) despite a formal sale agreement, the taxpayer retained control of the business and ownership of its income; 2) bank statements, ...