Family-run businesses will be breathing a sigh of relief, according to local accountants Griffiths and James, following the latest development in a landmark tax case.

Cwmbran-based Griffiths and James has welcomed the news that Arctic Systems has won its tax case against HM Revenue and Customs, a decision that could allow husband-and-wife businesses to share their tax burdens instead of facing a huge tax bill.

David Griffiths, at Griffiths and James, said: "When Geoff and Diana Jones of Arctic Systems originally lost their Section 660A appeal local business men and women feared they could face huge tax bills. The news that their appeal has been won is therefore very welcome. "There are still a number of uncertainties regarding cases of this nature, for example how the rules relate to partnerships, or if the spouse in question did not actually contribute to the business at all. "However, this news is a step in the right direction and we're confident further clarifications will be made public in due course."

The Court of Appeal found in favour of Arctic Systems in their appeal against the previous High Court's ruling in favour of HM Revenue & Customs' interpretation of the s660a settlements legislation. The court ruled that the dividends paid to Mrs Jones were not classed as settlements, as HMRC had claimed. The case dates back to April 2003 when Arctic Systems, a computer business run by Geoff and Diana Jones, was picked out by the Revenue, which claimed the husband and wife team owed £42,000 in tax dating back over six years.

The Section 660A appeal, revolved around the tax regulators' objection to the way Geoff and Diana Jones, of Arctic Systems, used their salaries and dividend payments to reduce their joint tax bill.