Venables v Hornby (Inspector of Taxes)

The House of Lords considered whether payments made from a pension scheme to a person who had ceased full-time executive employment but remained an unpaid non-executive director were chargeable to income tax under the Income and Corporation Taxes Act 1988. The court addressed whether the recipient had in fact retired and, if so, whether that retirement was "in normal health" for the purposes of the scheme. It also considered whether a payment not authorised by the terms of the scheme meant that the recipient was not beneficially entitled to it and therefore not chargeable to tax. The statutory provisions in issue included sections 590, 591, 600 and 612 of the 1988 Act.

Background and parties: Not all facts are detailed in the excerpt. The dispute concerned payments from a pension scheme to an individual who had ceased to be a full-time executive director but remained an unpaid non-executive director; the individual had health conditions described as overweight with high blood pressure and mild diabetes.

Nature of the claim: The central question was whether the payments were chargeable to income tax, i.e. whether they were payments in the course of payment of a pension or otherwise taxable under the Income and Corporation Taxes Act 1988.

Issues framed by the court:

• Whether the recipient had retired.
• Whether any retirement was "in normal health" within the meaning relevant to the pension scheme.
• Whether, if a payment was not authorised under the scheme, the recipient was nevertheless beneficially entitled to it and therefore taxable.

Procedural posture: The matter was before the House of Lords on appeal. The lower decisions and detailed prior steps are not set out in the excerpt.

Reasoning and decision: The excerpt does not set out the court's detailed reasoning or its dispositive conclusion on the appeal.