Taxing Matters: Spotlight 63: HMRC shines a light on property business arrangements involving hybrid partnerships

In this episode, Alexis Armitage, RPC's Taxing Matters host and Senior Associate in our Tax Disputes team, is joined by Simon Howley and Amanda Perrotton from Bell Howley Perrotton LLP. They discuss HMRC's Spotlight 63, which focuses on property business arrangements involving hybrid partnerships, which have recently come to the attention of HMRC.

In this episode, we discuss:

• Spotlight 63 and HMRC's view of property business arrangements involving hybrid partnerships and why HMRC consider such arrangements to be fiscally ineffective
• the individuals and companies for whom Spotlight 63 might be relevant
• what the consequences might be for those who have participated in the type of property business arrangements referred to in Spotlight 63.

Update – August 2026: This episode was recorded in 2024 and principally concerns HMRC’s Spotlight 63 and property-business arrangements involving hybrid partnerships. During the discussion, the external guests also commented upon Property118 Limited’s Substantial Incorporation Structures (SIS) and Capital Account Restructure (CAR) arrangements. The opinions expressed by the external guests in this episode reflected their personal views as at the date of the recording.

On 31 July 2026, the First-tier Tribunal allowed appeals brought by Property118 Limited and Cotswold Barristers Limited, against HMRC’s allocation of Scheme Reference Numbers under the Disclosure of Tax Avoidance Schemes (DOTAS) regime. The decision addressed only whether the SIS and CAR arrangements were legally notifiable under the DOTAS rules.

The First-tier Tribunal's decision can be accessed here: https://caselaw.nationalarchives.gov.uk/ukftt/tc/2026/1111

We hope you enjoy the episode. Please subscribe on Apple Podcasts or Spotify to keep up with future episodes.

If you would like to discuss any of the matters raised in this episode, please contact Adam Craggs and Alexis Armitage.

All information is correct at the time of recording. Taxing Matters is not a substitute for legal advice.