A significant legal victory is being claimed by HM Revenue and Customs in a multimillion-pound corporate tax avoidance case.
Fidex Ltd, a subsidiary of BNP Paribas, went to the Court of Appeal to challenge the legality of the Revenue's use of a hotly-disputed "anti-avoidance" rule.
The case involved Project Zephyr, an avoidance scheme with £17.2 million of tax at stake.
The court heard the scheme, involving synthetic sales of bonds, was designed to take advantage of different accounting standards governing when assets should be recognised.
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Fidex appealed against an Upper Tribunal (Tax and Chancery Chamber) decision that supported the Revenue's use of an "unallowable purpose test" to block the multimillion-pound claim for tax relief.
But three appeal judges - Lady Justice Arden, Lord Justice Kitchin and Sir Stephen Richards - on Thursday unanimously dismissed the appeal and agreed that the tribunal had "come to the right conclusion".
In the lead decision, Lord Justice Kitchin said the object of Project Zephyr was to create a "loss" which would be available for group relief throughout the BNP Paribas group.
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The Revenue argued that Schedule 9 of the Finance Act 1996 applied so as to deny Fidex the benefit of the loss.
Rejecting the Fidex appeal, Lord Justice Kitchin agreed that it was "wholly attributable to an unallowable purpose".
Jim Harra, HMRC's director general, business tax, said: "This is another important win against tax avoidance.
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"The scheme was being used by the subsidiary of a major bank to dodge tax and the Court of Appeal have confirmed that it doesn't work. "
"HMRC will always take on schemes like these on behalf of the vast majority of taxpayers who play by the rules and pay their share.
"The unallowable purpose test works by preventing taxpayers from getting a tax advantage where the main object, or one of the main objects of a transaction or arrangements, is to obtain that advantage.
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