Zoe Andrews and Tanja Velling discuss the following recent cases:

• Dolphin Drilling: the Supreme Court’s decision on the meaning of “incidental” should not be read as having wider application beyond the oil contractor regime
• Haworth (Court of Appeal) applying the place of effect management test to a trust in the context of a “round the world” capital gains tax scheme
• Marlborough DP (Court of Appeal) on the tax treatment of a remuneration structure involving loans made by a trust and the meaning of “in connection with” in Part 7A of ITEPA
• Osmond: the Upper Tribunal held that it was an error of law to equate seeking a capital gains tax relief with having a main purpose of obtaining an income tax advantage
• Eastern Power Networks (First-tier Tribunal), a cautionary tale on structuring to maximise consortium relief

The podcast also covers HMRC’s new guidance on advance pricing agreements for cost contribution arrangements, the government’s recently published tax policy making principles, Revenue & Customs Brief 4 (2025) on input tax recovery in respect of investment and administration costs linked to occupational pension funds and what’s next for Pillar Two.

Zoe Andrews and Tanja Velling are joined by Arvind Ravichandran, Tax Partner at Cravath, to discuss the impact the proposed section 899 could have on US capital markets if enacted but how it is unlikely to be a big issue in practice.

They cover:

• The purpose and potential withdrawal from the Bill of Section 899, a proposed tax on foreign investors, in response to global tax developments
• How changes to the GILTI regime aim to more closely align U.S. tax policy with OECD standards
• The mix of permanent tax cuts and temporary “America First” measures included in the Bill
• Key negotiation points for Congress including the SALT cap, Medicaid reforms, and clean energy tax credits

Zoe Andrews and Tanja Velling discuss the Upper Tribunal’s decisions in Walkers Snack Foods on the VAT classification of “Sensations Poppadoms” and Rettig Heating Group, the judicial review of HMRC’s refusal of a late claim to set off a non-trading loan relationship deficit. They then discuss the Court of Appeal’s decision in Beard on the meaning of “dividends of a capital nature”.

The podcast also covers the UK government’s plans to modernise stamp taxes on shares, draft legislation for the reform of diverted profits tax, and transfer pricing and permanent establishment legislation, and a consultation on the potential changes to the process for resolving tax disputes.

It further discusses HMRC’s revised unallowable purpose guidance and international news including on a US tax change (the addition of a new Code section 899) that could significantly increase the tax cost of investing in the US for residents of countries that are deemed to impose “unfair” taxes.