UK - The Inland Revenue is to continue its long-running claim on a company director's lump sum pension by appealing a High Court decision.
A ruling last month determined that a payment of £580,000 to David Venables of Ven Holdings should not be liable to a tax claim made by the Inland Revenue.
The dispute dates back to 1994 when Venables, then aged 53, retired from his position as director of Ven Holdings and claimed the lump sum from the company’s pension scheme.
The Inland Revenue had originally argued that as Venables continued to work for Ven Holdings he had not in fact actually retired.
But Venables successfully appealed against this decision by arguing that he had to scale down his work due to ill-health and continued only in the minor role of non-executive director.
The Inland Revenue then successfully appealed that Venables’s retirement on ill-health grounds contravened the Ven Holdings pension scheme rules, which stated that early retirement payments were only applicable where the member retired in good health.
In the High Court ruling in June, the judge said he considered the reference to retiring in “normal health” in the scheme rules as a drafting error. The judge added that Venables’s high blood pressure and mild diabetes was not unusual for a man in his 50s.
Hammond Suddards Edge solicitor Francois Barker said of the judgement: Concern about Venables health was one of the reasons for his retirement, so it is rather surprising that the judge went on to find that Mr Venables was in normal health.
“The judge's reasons for this – that the words ‘in normal use’ were a drafting error, that Mr Venables's pre-retirement 50 hour working week showed he was in ‘normal health’, and that high blood pressure and diabetes are common in middle aged men – are not particularly convincing.
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