When can a partial closure notice be required?

In Embiricos v HMRC the Court of Appeal has provided clear guidance on the circumstances in which a partial closure notice can be issued by HMRC to bring finality to a discrete aspect of an enquiry.  Although the decision was concerned with a dispute regarding domicile status, it has broad application and is therefore essential reading for those tasked with handling an HMRC enquiry. Read more

Estoppel by convention and notices of enquiry

In Tinkler v HMRC [2021] UKSC 39, HMRC had not validly served a notice of enquiry on the taxpayer. However, the Supreme Court held that the taxpayer was prevented from relying on this fact (in order to dispose of a tax dispute) as a result of the operation of the doctrine of estoppel by convention. This was principally because the taxpayer and his advisers had, for a long period of time, corresponded with HMRC on the assumption that the notice of enquiry had been validly issued. Read more

Kandore: information notices and the limits of open justice

The Court of Appeal has considered HMRC's, and the Tribunal's, usual practice of hearing applications for the pre-approval of compulsory information notices in private, and without the participation of the intended recipient of the notice (or, where different, the relevant taxpayer).  Unfortunately for those on the receiving end of such notices, the Court has determined that this practice should continue. Read more

Supreme Court provides guidance on Follower Notices

In R (Haworth) v HMRC, the Supreme Court has provided welcome guidance in relation to the follower notice regime, confirming that a notice may be issued only where HMRC believes that there is "no scope for a reasonable person to disagree that the earlier ruling denies the taxpayer the [relevant tax] advantage".  It presents HMRC with a high bar, but one that is justified given the draconian nature of the regime. Read more

Supreme Court rules on what is “deliberate”

In a decision restoring common sense, the Supreme Court in HMRC v Tooth has determined that for conduct to be culpable as deliberate there must (generally) be an "intention to mislead".  Less encouragingly (though not determinative in the case) the Court was not persuaded that a discovery could become stale, thereby preventing an otherwise "in time" discovery assessment from being made, for the purposes of the statutory framework relating to such assessments. Read more

DAC 6 Reporting Deferred in the UK

The UK government has today announced that the first reporting deadline under DAC 6 will be deferred for 6 months to allow taxpayers and advisors impacted by COVID-19 additional time to comply with their obligations. The first reports under DAC 6 will now be due by 31 January 2021. Read more

Tax Appeals: Don’t Forget ADR

A Practice Direction issued by the President of the First-tier Tribunal (Tax) reminds taxpayers to consider whether it may be appropriate to engage with HMRC regarding the use of ADR.

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Discovery Assessments after Tooth: it’s never too late, it seems

Where a loss of tax has been brought about deliberately by a taxpayer, the time limit for HMRC to raise a discovery assessment is increased from 4 years to 20 years.  In The Commissioners for HMRC v Raymond Tooth, the Court of Appeal held that for an inaccuracy to be "deliberate", there need not be any culpable conduct attributable to the taxpayer in question. Read more