Freeman v Revenue & Customs [2013] UKFTT 496 (TC) (19 September 2013)

Freeman v Revenue & Customs [2013] UKFTT 496 (TC) (19 September 2013)

The Tribunal held that the information provided in the 2002/03 tax return was insufficient to alert a hypothetical officer to the insufficiency of tax, as required by s.29(5) TMA 1970. However, the provision of the Loan Note instrument and related correspondence in 2000 satisfied the notification requirements under s.29(6)(d)(ii) TMA 1970, as the information was relevant to the 2002/03 assessment. Therefore, HMRC was precluded from raising a discovery assessment for 2002/03, and the appeal was allowed.

Citation
[2013] UKFTT 496 (TC)
Parties
Appellant: Michael Freeman; Respondents: The Commissioners for Her Majesty’s Revenue & Customs
Jurisdiction
United Kingdom
Judgment Date
19 September 2013
Procedural Posture
Income Tax Appeal (discovery Assessment) / First Tier Tribunal (tax) Final Judgment
Outcome
Appeal allowed
Legal Topics
Discovery Assessment, Self Assessment, Capital Gains Tax, Qualifying Corporate Bonds, Taper Relief, Disclosure Requirements, Section 29 TMA 1970
Tax Law Discovery Assessment Self Assessment Capital Gains Tax Qualifying Corporate Bonds Taper Relief Disclosure Requirements Section 29 TMA 1970

Case Brief

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Parties

Michael Freeman

Appellant

The Commissioners for Her Majesty’s Revenue & Customs

Respondents

Procedural Posture

Income Tax Appeal (discovery Assessment) / First Tier Tribunal (tax) Final Judgment

Legal Issues

  1. 1 Whether HMRC was entitled to raise a discovery assessment for the 2002/03 tax year under s.29 TMA 1970
  2. 2 Whether sufficient information was provided to HMRC to preclude a discovery assessment under s.29(5) TMA 1970
  3. 3 Whether the provision of the Loan Note instrument in 2000 satisfied the notification requirements under s.29(6)(d)(ii) TMA 1970

Ratio Decidendi

The Tribunal held that the information provided in the 2002/03 tax return was insufficient to alert a hypothetical officer to the insufficiency of tax, as required by s.29(5) TMA 1970. However, the provision of the Loan Note instrument and related correspondence in 2000 satisfied the notification requirements under s.29(6)(d)(ii) TMA 1970, as the information was relevant to the 2002/03 assessment. Therefore, HMRC was precluded from raising a discovery assessment for 2002/03, and the appeal was allowed.

Court Disposition

Appeal allowed

Orders

  • The discovery assessment for the 2002/03 tax year is set aside.