Guernsey Judgment 4/2002 - Administrator of Income Tax v Tremoille Properties Limited

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Income Tax—deductions—loan arrangements—loan not usually capital asset, but may be, e.g. if so inextricably linked with retaining taxpayer's primary capital asset that properly regarded as capital asset itself—payment to effect base rate cap agreement to protect against adverse interest rate fluctuations may be allowable deduction from income for tax purposes Income Tax—deductions—test to be applied—in absence of relevant Guernsey authority, English test applied for whether payment constitutes revenue or capital expenditure for purpose of deductions—court to balance various factors pointing one way or other, e.g. nature and effect of payments and of benefits obtained in return