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

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

The Tribunal held that while Mr Evans failed to substantiate the full amounts claimed for travel and secretarial assistance, reasonable deductions should be allowed at lower levels (£500 per annum for travel, £11,000 per annum for secretarial assistance). Payments to Mrs Evans from a joint account constituted payment for tax purposes. Mr Evans was negligent in submitting incorrect returns, justifying a penalty, which was increased to 40% due to insufficient cooperation.

Citation
[2010] UKFTT 140 (TC)
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 Appeal (first Tier Tribunal Tax) / Decision on Appeal Against Closure Notice, Discovery Assessments, and Penalty Determination
Outcome
Appeals allowed in part.
Legal Topics
Income Tax Deductions, Employment Income, Deductibility of Expenses, Travel Expenses, Secretarial Assistance, Penalties for Negligent Tax Returns
Tax Law Employment Law Income Tax Deductions Employment Income Deductibility of Expenses Travel Expenses Secretarial Assistance Penalties for Negligent Tax Returns

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Parties

Mr John Evans

Appellant

The Commissioners for Her Majesty’s Revenue and Customs

Respondents

Procedural Posture

Income Tax Appeal (first Tier Tribunal Tax) / Decision on Appeal Against Closure Notice, Discovery Assessments, and Penalty Determination

Legal Issues

  1. 1 Whether the deductions claimed for travel expenses were reasonable and substantiated
  2. 2 Whether the deductions claimed for secretarial assistance were reasonable and substantiated
  3. 3 Whether the amounts paid to Mrs Evans constituted 'payment' or 'defraying' for tax purposes

Ratio Decidendi

The Tribunal held that while Mr Evans failed to substantiate the full amounts claimed for travel and secretarial assistance, reasonable deductions should be allowed at lower levels (£500 per annum for travel, £11,000 per annum for secretarial assistance). Payments to Mrs Evans from a joint account constituted payment for tax purposes. Mr Evans was negligent in submitting incorrect returns, justifying a penalty, which was increased to 40% due to insufficient cooperation.

Court Disposition

Appeals allowed in part.

Orders

  • Closure notice and assessments to be varied: deduction for travel expenses reduced to £500 per tax year.
  • Deduction for secretarial and administrative assistance reduced to £11,000 per tax year.