Evans v Revenue & Customs [2010] UKFTT 140 (TC) (22 March 2010)

Evans v Revenue & Customs [2010] UKFTT 140 (TC) (22 March 2010)

The Tribunal found that while Mr Evans failed to discharge the burden of proof for the full amounts claimed, reasonable deductions for travel (£500 per annum) and secretarial assistance (£11,000 per annum) should be allowed based on the evidence of workload and market rates. Payments to Mrs Evans via a joint account constituted payment for statutory purposes. Mr Evans was negligent in submitting incorrect returns, warranting a penalty, but the penalty abatement for co-operation was too generous and should be reduced, increasing the penalty to 40% of the relevant tax.

Citation
[2010] UKFTT 140
Parties
Appellant: Mr John Evans; Respondents: The Commissioners for Her Majesty’s Revenue and Customs
Jurisdiction
United Kingdom
Judgment Date
22 March 2010
Procedural Posture
Income Tax/corporation Tax Appeal / First Tier Tribunal (tax) Decision
Outcome
Appeals allowed in part
Legal Topics
Income Tax, Employment Income, Deductibility of Expenses, Travel Expenses, Secretarial Assistance, Penalties for Negligent Conduct
Tax Law Income Tax Employment Income Deductibility of Expenses Travel Expenses Secretarial Assistance Penalties for Negligent Conduct

Case Brief

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Parties

Mr John Evans

Appellant

The Commissioners for Her Majesty’s Revenue and Customs

Respondents

Procedural Posture

Income Tax/corporation Tax Appeal / First Tier Tribunal (tax) Decision

Legal Issues

  1. 1 Whether the deductions claimed by Mr Evans for travel and secretarial assistance expenses were excessive and should be disallowed in part
  2. 2 Whether the amounts claimed for secretarial assistance were 'paid' or 'defrayed' as required by statute
  3. 3 Whether Mr Evans was negligent in submitting incorrect tax returns, justifying a penalty

Ratio Decidendi

The Tribunal found that while Mr Evans failed to discharge the burden of proof for the full amounts claimed, reasonable deductions for travel (£500 per annum) and secretarial assistance (£11,000 per annum) should be allowed based on the evidence of workload and market rates. Payments to Mrs Evans via a joint account constituted payment for statutory purposes. Mr Evans was negligent in submitting incorrect returns, warranting a penalty, but the penalty abatement for co-operation was too generous and should be reduced, increasing the penalty to 40% of the relevant tax.

Court Disposition

Appeals allowed in part

Orders

  • The closure notice and assessments are varied to allow a deduction of £500 per annum for travel expenses for each tax year in dispute.
  • A deduction of £11,000 per annum for secretarial and administrative assistance is allowed for each tax year in dispute.