LLOYDS BANKING GROUP is locked in a £1bn tax dispute with HM Revenue & Customs over its use of Irish losses to drive down its UK bill.
The sizable assessment from the taxman stems from losses made in Ireland by the state-backed lender as it wound down its defunct Irish subsidiary.
It was notified in the second half of last year that HMRC was unhappy with the treatment of the Irish losses to offset the bank's tax bill, the Telegraph reports.
Should HMRC win the case, Lloyds would have to pay £600m in tax and write off a further deferred £400m, which it currently has written off against future profits.
In a statement made to investors, Lloyds said: "The group does not agree with HMRC's position and, having taken appropriate advice, does not consider that this is a case where additional tax will ultimately fall due."
Sign up for Financial Director email alerts
Please enter your email below to receive your profile link
Search by job title, salary, or location - we only list senior financial roles
Entries are open, and judges lined up, as the Business Finance Awards 2016 are launched, celebrating the best FDs and finance teams
4pm, 11 Nov 2015
Join us on Wednesday 11 November when we reveal the findings from our survey into finance leaders’ attitudes on moving their business critical applications into the Cloud
Send to a friend