Valyrian Bloodstock Limited v The Commissioners for HMRC
Decision date: 25 August 2022
Neutral citation: [2022] UKFTT 306 (TC)
Overall AI summary confidence: medium
Short overview
This short overview is intended to summarise the case, issues and outcome so far as they are supported by the judgment.
AI confidence in this short overview: medium
This appeal challenged HMRC’s refusal to issue EIS compliance certificates for shares issued by Valyrian Bloodstock Ltd in 2019. The Tribunal found on contemporaneous documentary evidence (website, marketing and correspondence) that the share offers were for three‑year syndicates intended to be wound up for capital sale, so the s157A risk‑to‑capital and trading requirements were not met. The appeal was dismissed and HMRC’s refusal upheld.
Ratio decidendi
This summary is intended to identify the ratio decidendi, meaning the legal reasons for deciding and the binding part of the decision.
AI confidence in this ratio decidendi summary: medium
The Tribunal treated contemporaneous documentary and marketing materials as primary evidence when assessing the s157A risk‑to‑capital condition and whether the issuer carried on a qualifying trade; late, retrospective investor witness statements were given limited weight. Marketing an explicit fixed short‑term syndicate and lack of basic business documentation (advance assurance, business plan, forecasts, prospectus) supported a conclusion that the issuer lacked the requisite intention to grow and develop a long‑term trade for EIS purposes.
Obiter dicta
This summary is intended to identify obiter dicta, meaning observations made by the way that were not necessary to deciding the case and are not binding.
AI confidence in this obiter dicta summary: medium
The Tribunal indicated that subcontracting operational activities does not automatically preclude EIS relief, though the extent and context of outsourcing are relevant to the risk‑to‑capital assessment. It also noted that prior approvals for similar schemes or sector policy aims do not override the statutory conditions and the need to assess contemporaneous evidence.
Warning
- Chunk contains duplicated/repetitive passages and extensive citation of earlier authorities; care was taken to judgment core findings. Notes include some duplication and extensive citation; they appear complete for the main findings but may omit finer factual detail.