UK Tribunal Nixes Cayman Co.'s Interest Deduction Appeal

By Dylan Moroses (August 3, 2022, 2:36 PM EDT) -- A U.K. tribunal dismissed a Cayman Islands limited partnership's challenge to profit reallocations and denied interest deductions related to funds borrowed to acquire a stake in a U.K. partnership, increasing its taxable income by nearly £32.25 million ($39.2 million).

BlueCrest Capital Management Cayman Ltd., or BCMCL, cannot claim tax relief on $365 million it borrowed to purchase interest from partners that sold their stake in the U.K.-based BlueCrest investment management group, according to the Upper Tribunal's judgment published Tuesday.

The First-tier Tribunal properly found that BCMCL was the only entity to enter the U.K. partnership and therefore was liable for additional corporate tax...

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