판결 이유
Where a transaction is carried out as a series of pre-ordained steps with no commercial purpose other than tax avoidance, the court should look at the composite transaction as a whole rather than each step in isolation.
사실관계
The taxpayer company entered into a series of self-cancelling transactions designed to create an artificial capital loss for tax purposes.
판결 요약
The House of Lords held that the court should look at the realistic effect of the composite transaction. Where steps are pre-ordained and have no commercial purpose, the court considers their combined effect.
주요 인용문
"The court is not confined to the form of the transaction but can look at its substance and effect."
— Lord Wilberforce
후속 처리
Leading Authority
Foundation of the purposive approach to tax avoidance in UK law.