Article summary
Private Client analysis: Murphy v HMRC [2025] UKFTT 1503 (TC), like the Court of Appeal decisions in HMRC v Smallwood and Haworth v HMRC before it, concerns capital tax planning for offshore trusts commonly known as ‘round the world’ schemes. The scheme attempted to rely on the terms of double taxation agreements as a defence to a charge to capital gains tax on disposals of trust assets. Murphy differed from previous cases because the double taxation agreement in question was with New Zealand and was differently worded from the treaty with Mauritius considered in Smallwood. Ultimately, however, the FTT concluded that did not make a difference. The FTT did, however, reject HMRC’s restrictive interpretation of what was required for a claim to relief under the treaty. It also took a strict view of how HMRC were required to meet their burden of proof in relation to discovery assessments, finding in relation to one assessment that the requirements of section…
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