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

What is “reasonable detail” when notifying a tax claim under an SPA?

In Dodika v ULGH [2021] EWCA Civ 638, the Court of Appeal considered whether the Defendant (buyer) complied with the requirement to give "reasonable detail" of the matter giving rise to a tax claim under the SPA when notifying that claim to the Claimants (sellers).  The tax claim arose in connection with an ongoing transfer pricing enquiry (conducted by the Slovenian tax authority) of which the sellers were already aware.  We consider the Court's decision (in favour of the buyer) in this blogpost. Read more

Danish WHT fraud claim dismissed

The High Court has dismissed a claim by the Danish tax authorities (against more than 100 defendants) that it was wrongly induced to refund more than £1bn of tax.  It did so based on the established principle that English courts will not enforce foreign revenue laws.  Unless reversed, the decision will cast doubt on the ability of other tax authorities to proceed with cum/ex fraud claims in the High Court. Read more

HMRC’s ability to argue fraudulent misrep hindered

In the latest round of litigation in HMRC's bid to avoid a settlement agreement with members of the GE group of companies, the Court of Appeal has refused HMRC permission to amend their case to seek the equitable rescission of the settlement agreement on the ground of fraudulent misrepresentation.  Although the decision offers some comfort to the taxpayers concerned, it serves as a reminder that taxpayers should approach settlement discussions with HMRC with care. Read more

Latest thinking from HMRC on offshore compliance

Within the framework of its "No Safe Havens" tax compliance strategy, HMRC has published two discussion papers concerning aspects of the administration of "offshore" or "international" tax.  You can read more about both papers in this blog post. Read more