Ramsey principle

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In UK tax law, the principle that the court is entitled to look at a transaction or series of connected transactions as a whole in order to decide the taxpayer's liability to tax. It is named after the ruling in the case Commissioners of Inland Revenue v W T Ramsey Ltd, in which the House of Lords ruled against a company that had used certain self-cancelling transactions to create a non-taxable gain and a tax-relievable loss. The Ramsey principle can be seen as a limitation on the Westminster doctrine; its scope has, however, been restricted by subsequent case law.

Subjects: Financial Institutions and Services — Accounting.

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