Graham Aaronson QC, Tom Beazley QC and Jonathan Bremner (instructed by Joseph Hage Aaronson LLP ) for the claimants; David Ewart QC, Rupert Baldry QC, Andrew Burrows QC, Kelyn Bacon QC, Oliver Conolly and Barbara Belgrano (instructed by the Treasury Solicitor General Counsel and Solicitor to HMRC) for the defendants.
The test claimants were a number of United Kingdom resident companies in the British American Tobacco group in the long-running franked investment income group litigation concerned with corporation tax on dividends. The test claimants sought, inter alia, restitution of sums paid by them under the UK advance corporation tax (“ACT”) statutory regime in place between 1973 and 1999, or under section 18 (Schedule D, Case V) of the Income and Corporation Taxes Act 1988. The judgment of the Court of Justice of the European Union ( on 12 December 2013 in the present proceedings ((Case C-362/12); EU:C:2013:834; [2014] AC 1161) meant that the revenue’s attempts to confine the test claimants’ mistake-based claims to those brought within the same six-year limitation period as that which applied to their Woolwich-based claims (Woolwich Equitable Building Society v Inland Revenue Comrs [1993] AC 70) had failed. The test claimants were therefore entitled to rely on their mistake-based claims, subject to any available defences, to recover all overpaid tax plus interest dating back to 1973 in some cases. Henderson J subsequently gave directions for the trial of 29 remaining issues of liability and quantification aside from certain issues deferred by the Supreme Court in 2010.
Henderson J determined the various issues on the calculation of unlawful Schedule D, Case V tax; the calculation of unlawful ACT; other issues of principle; and remedies. It was agreed that claims should not be quantified at the present stage. Further submissions on quantum would be made in consequence of the judgment.