The future use test was considered in Barclays Bank Trust Co Ltd
v CIR SpC 158. The Special Commissioner posed the question as
follows, at para 10 of his decision –
“Was the £300,000 cash held by the company
required on 23 November 1990 for future use for the purposes of the
business? This is a question of fact and on the evidence before me
I cannot find that it was so required. I do not accept that
“future” means at any time in the future nor that
“was required” includes the possibility that the money
might be required should an opportunity arise to make use of the
money in two, three or seven years’ time for the purposes of
the business. In my opinion and I so hold that
“required” implies some imperative that the money will
fall to be used upon a given project or for some palpable business
purpose.”
Whether this test is satisfied is a question of evidence in
the circumstances of the particular case. Have regard to the nature
and previous history of the business and such evidence as may be
produced (which may incidentally affect the open market value of
the business) as to prospective development and capital outlay. In
particular, the extent to which cash, bank accounts, building
society accounts and similar assets included in the accounts of a
business may be excepted assets should always be examined
carefully. If the evidence is not considered to be sufficient to
support the claim for relief for substantial assets which do not
satisfy this test, refer the case to your manager.
