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Tax relief on debt write-off upheld as Revenue’s interpretation of tax law overturned
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High Court has overturned the Tax Appeals Commissioner's (TAC) determination that a significant debt release should be treated as a taxable trade receipt, finding that the TAC erred in law by conflating the 'debt' with the 'asset' purchased by the debt, and that the write-down of the asset's value and subsequent carrying forward of losses did not equate to a deduction allowed for a debt; and consequently, the release of the loan balance should not be treated as a receipt of the trade.
Tax Appeals Commissioner - Revenue Commissioners - High Court - Taxes Consolidation Act 1997 - section 87(1) - debt release - trade receipt - taxable income - debt write-off - loan forgiveness - statutory interpretation - deduction allowance - asset write-down - tax losses carried forward - legal error - corporate taxpayer - debt versus asset - financial accounting - FRS 102 - Case I Schedule D - tax law - jurisprudence.
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