The recent decision of the Court of Appeal in BlackRock Holdco 5, LLC v HMRC [2024] EWCA Civ 330 is the latest judicial pronouncement on two UK tax issues arising from the BlackRock group’s $13.5bn acquisition of the US business of Barclays Global Investors in 2009: (i) transfer pricing; and (ii) the application of the loan relationship unallowable purpose rules.

Helen Buchanan and Sarah Bond, partners in our London tax team, discuss the key takeaways from this decision in the article at the link below.

The article explains that, in the transfer pricing context, the decision considers whether features not present in the actual transaction can be imported into the hypothetical arm’s length transaction to enable a comparison exercise. The Court of Appeal also gives clear guidance that the availability of tax relief for interest on a loan does not, without more, mean that the borrower has a tax avoidance purpose in entering into the loan and provides a welcome steer on what may be permissible in conducting a just and reasonable apportionment exercise.

This article was originally published in Tax Journal on 26 April 2024.