In Inferno Films Ltd v HMRC [2022] UKFTT 141 (TC), the FTT allowed the taxpayer's appeal against HMRC's refusal to authorise the issue of compliance certificates, finding that the taxpayer had satisfied the 'risk-to-capital' test required for Enterprise Investment Scheme (EIS) relief. This decision represents an unequivocal rejection by the FTT of HMRC's overly narrow interpretation of the contemporaneous documentation when assessing Inferno's objectives to grow and develop its trade in the long term (for the purposes of the risk-to-capital test for EIS relief). The FTT's endorsement of a more realistic and commercial approach will be welcomed by taxpayers, in particular, by small newly formed companies that may have a necessarily short-term focus on individual projects in order to acquire the financial resources needed to grow and develop their trade in the long term. You can read our full commentary on the decision here.

And finally...

How big an issue is tax avoidance? The tax gap refers to the difference between the amount of tax that should, in theory, be paid to HMRC, and what is actually paid. To help narrow this gap, HMRC has been granted a number of powers over the years, including those aimed at tackling tax avoidance. The Finance Act 2022 provided HMRC with additional powers to enable it to proactively clamp down on promoters of tax avoidance schemes, challenge misleading information and ''name and shame' connected individuals.