Arctic Systems - Case to go to Court of Appeal

The appeal in the Arctic Systems case, in which the High Court backed the contention of HM Revenue and Customs that arrangements in a ‘husband and wife’ company by which income was divided and taken by way of dividends constituted an ‘arrangement’ to reduce tax, will be heard at the Court of Appeal on in late November 2005.

The case, which has profound implications for many small companies, has been supported in particular by professionals acting for computer contractors, as many small IT consultancy firms operate such arrangements.

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