A tribunal found Cogefin was a UK tax resident after key company decisions were made from Britain
UK tax resident status has been imposed on a Bermuda-incorporated investment company after the First-tier Tax Tribunal found that its central management and control operated from Britain for almost two decades.
The tribunal ruled on 30 July 2026 that Cogefin (Bermuda) Limited was resident in the UK for corporation tax purposes between 1999 and 2017. The decision focused on where the company’s highest-level decisions were actually made, rather than simply where it was incorporated, administered or held board meetings.
According to the findings reported by the Society of Trust and Estate Practitioners (STEP), the tribunal concluded that Cogefin’s central management and control operated from the UK. It found that Giuseppe Ciardi, the company’s beneficial owner, made key decisions while in Britain, rather than those decisions originating with Cogefin’s directors in Bermuda.
Cogefin was incorporated in Bermuda in 1996 and was established to hold and manage investments for the Poole Family Trust. Its directors were lawyers based in Bermuda, while an affiliated company provided corporate administration services. The directors named in the judgment were Roderick Forrest, Nicholas Hoskins, Garth Lorimer Turner, Ian Pilgrim and Maxwell Quin.
The case followed a disclosure made by Mr Ciardi under the Liechtenstein Disclosure Facility in 2012. HM Revenue and Customs then investigated whether Cogefin was genuinely managed from Bermuda or whether its central management and control was instead located in Britain.
The tribunal examined more than 20,000 pages of correspondence and board records covering two decades, together with extensive witness evidence. It placed greater weight on contemporaneous documents than on recollections given by witnesses about events that had occurred many years earlier.
HMRC argued that the Bermuda directors were effectively approving decisions that Mr Ciardi had already made in the UK. The appellants disputed that position and maintained that the directors exercised independent judgement in Bermuda, with Mr Ciardi acting as an investment adviser whose recommendations were considered before the directors reached decisions.
The tribunal identified repeated examples in which administrators sought Mr Ciardi’s approval for matters that it considered should have been determined by the directors. These included payments, investment commitments and banking arrangements.
One example concerned a £2 million investment in Lavendon Group shares. The tribunal found that Mr Ciardi negotiated the investment directly with Morgan Stanley before the Bermuda directors were asked to provide the documentation needed to authorise a transaction that had already been agreed. The judgment identified similar patterns involving property acquisitions, investment funds and financing arrangements.
The tribunal found that the Bermuda directors were conscientious and honest witnesses but concluded that the documentary evidence showed they generally responded to requests rather than making the company’s highest-level decisions themselves. It found that Mr Ciardi’s correspondence went beyond providing advice and amounted to instruction, control and decision-making.
The ruling did not, however, find that the company’s tax conduct was deliberate. The tribunal concluded that the directors genuinely believed Cogefin was not UK resident for tax purposes. It therefore characterised the behaviour as careless rather than deliberate and reduced the associated penalties to 25 per cent of the potential lost tax revenue.
The tribunal also upheld Mr Ciardi’s appeal against a personal liability notice issued by HMRC. The amount of corporation tax ultimately payable by Cogefin will be determined separately.
The decision highlights the importance of examining the substance of corporate decision-making when determining UK tax residence. Current UK tax guidance confirms that an overseas-incorporated company can be treated as UK tax resident where its central management and control is situated in the UK, subject to applicable treaty provisions.