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United Kingdom Leading Case grounds illegality

WT Ramsay Ltd v IRC

[1982] AC 300
JurisdictionUnited Kingdom
CourtUK House of Lords
Year1982
StatusBinding authority

Summary

The Ramsay principle holds that courts may look at a pre-ordained series of steps as a composite transaction rather than each step in isolation where the sole purpose is tax avoidance.

Key Principle

The Ramsay principle: where a transaction is carried out as a series of pre-ordained steps with no commercial purpose other than tax avoidance, the court may look at the composite transaction and not each step in isolation.

Area of Law

tax

Related Cases

Commissioner of Taxation v Consolidated Media Holdings Ltd (2012) 250 CLR 503

Statutory interpretation in tax law requires ascertaining meaning from text, context and purpose; beneficial construction favouring taxpayer is not appropriate.

Federal Commissioner of Taxation v Consolidated Media Holdings Ltd (Statutory Construction) [2012] HCA 55

Tax legislation is construed by giving words their ordinary meaning in context; legislative purpose resolves ambiguity but cannot override clear statutory language.

Aid/Watch Inc v Commissioner of Taxation (2010) 241 CLR 539

An organisation engaged in political advocacy and law reform can qualify as charitable, as generating public debate on matters of public interest satisfies the public benefit requirement.

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