Unjust enrichment and wrongly paid tax

• Main Author: TANG, Hang Wu
• Format: text
• Language: English
• Published: Institutional Knowledge at Singapore Management University 2006
• Subjects: Taxation-Transnational; Tax Law
• Online Access: https://ink.library.smu.edu.sg/sol_research/2391; https://ink.library.smu.edu.sg/context/sol_research/article/4349/viewcontent/4509199__1_.pdf
• Institution: Singapore Management University

Boake Allen Limited v. Revenue and Customs Commissioners [2006] EWCA Civ 25 concerned early payment of Advance Corporation Tax ("ACT"). ACT was normally payable when a company paid dividends to its shareholders, but there was a statutory exception where the company was a subsidiary of a United Kingdom company and both the parent and subsidiary made a group income election. If the tax authorities accepted the election, the obligation to pay ACT would only accrue when the parent company paid dividends. Section 247 of the Income and Corporation Taxes Act 1988 ("ICTA") stipulated that group income elections were only available to subsidiaries of United Kingdom companies. This provision was successfully challenged in Hoechst v. Attorney General [2001] S.T.C. 452 (noted by Virgo, (2002) 1 B.T.R. 4) as breaching the right of freedom of establishment enshrined in the EC treaty. In the aftermath of Hoechst, many claims for overpayment and/or premature payment of ACT followed. One of these was Deutsche Morgan Grenfell v. IRC [2005] EWCA Civ 78, [2005] S.T.C. 329 (noted by Hedley [2005] C.L.J. 296), involving a German subsidiary, which recognised that a claim for restitution lay in such circumstances, with the ground of restitution being an unlawful dem