Buckingham v Revenue and Customs (NCOME TAX AND CAPITAL GAINS TAX - Special Dividend from US company - HMRC discovery assessment on the basis that the Special Dividend was part income and part capital ) [2023] UKFTT 358 (TC) (04 April 2023)

Buckingham v Revenue and Customs (NCOME TAX AND CAPITAL GAINS TAX - Special Dividend from US company - HMRC discovery assessment on the basis that the Special Dividend was part income and part capital ) [2023] UKFTT 358 (TC) (04 April 2023)

The Tribunal held that Mr Butler’s discovery assessment was valid, as the Special Dividend consisted of both income and capital elements, and the conditions for a discovery assessment under TMA s 29(5) were met. The review officer’s decision to increase the assessment was out of time and not agreed, so the original assessment stands. HMRC failed to prove carelessness by Mr Buckingham.

Citation
[2023] UKFTT 358 (TC)
Parties
Appellant: John Buckingham; Respondents: The Commissioners for His Majesty’s Revenue and Customs
Jurisdiction
United Kingdom
Judgment Date
04 April 2023
Procedural Posture
Tax Appeal / First Tier Tribunal Decision
Outcome
Appeal allowed in part; Mr Butler’s assessment confirmed; review decision not upheld.
Legal Topics
Income Tax, Capital Gains Tax, Foreign Dividends, Discovery Assessment, Statutory Review, Capital/income Distinction
Tax Law Income Tax Capital Gains Tax Foreign Dividends Discovery Assessment Statutory Review Capital/income Distinction

Case Brief

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Parties

John Buckingham

Appellant

The Commissioners for His Majesty’s Revenue and Customs

Respondents

Procedural Posture

Tax Appeal / First Tier Tribunal Decision

Legal Issues

  1. 1 Whether HMRC's discovery assessment was valid under TMA s 29
  2. 2 Whether the Special Dividend was income or capital for UK tax purposes
  3. 3 Whether the statutory review decision was out of time

Ratio Decidendi

The Tribunal held that Mr Butler’s discovery assessment was valid, as the Special Dividend consisted of both income and capital elements, and the conditions for a discovery assessment under TMA s 29(5) were met. The review officer’s decision to increase the assessment was out of time and not agreed, so the original assessment stands. HMRC failed to prove carelessness by Mr Buckingham.

Court Disposition

Appeal allowed in part; Mr Butler’s assessment confirmed; review decision not upheld.

Orders

  • Mr Butler’s discovery assessment of £10,599.15 stands.
  • No increase to assessment as per review decision.