Anik v Revenue and Customs (INCOME TAX/CORPORATION TAX : Profits) [2016] UKFTT 395 (TC) (06 June 2016)

Anik v Revenue and Customs (INCOME TAX/CORPORATION TAX : Profits) [2016] UKFTT 395 (TC) (06 June 2016)

Discovery assessments were valid for 2005-06 to 2009-10, but not for 2011-12 and 2012-13 as HMRC failed to prove deliberate or careless conduct for those years. Penalties under s 95 TMA were due for 2005-06 and 2006-07, but not for 2007-08. Schedule 24 penalties were due for 2008-09, 2009-10, and 2010-11, but not for 2011-12 and 2012-13 due to lack of valid assessments. HMRC's profit calculations were rejected due to lack of evidence and methodology; appellant's figures accepted as more reliable.

Citation
[2016] UKFTT 395 (TC)
Parties
Appellant: Murat Anik; Respondents: The Commissioners for Her Majesty’s Revenue & Customs
Jurisdiction
United Kingdom
Judgment Date
06 June 2016
Procedural Posture
Appeal (first Tier Tribunal Tax) / Final Judgment After Full Hearing
Outcome
Appeal allowed in part, dismissed in part.
Legal Topics
Income Tax, National Insurance Contributions, Discovery Assessments, Penalties, Self Assessment, Burden of Proof
Tax Law Income Tax National Insurance Contributions Discovery Assessments Penalties Self Assessment Burden of Proof

Case Brief

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Parties

Murat Anik

Appellant

The Commissioners for Her Majesty’s Revenue & Customs

Respondents

Procedural Posture

Appeal (first Tier Tribunal Tax) / Final Judgment After Full Hearing

Legal Issues

  1. 1 Whether discovery assessments under s 29 TMA for various tax years were valid
  2. 2 Whether penalties under s 95 TMA and Schedule 24 FA 2007 were due
  3. 3 Whether the appellant understated trading income and omitted rental income and chargeable gains

Ratio Decidendi

Discovery assessments were valid for 2005-06 to 2009-10, but not for 2011-12 and 2012-13 as HMRC failed to prove deliberate or careless conduct for those years. Penalties under s 95 TMA were due for 2005-06 and 2006-07, but not for 2007-08. Schedule 24 penalties were due for 2008-09, 2009-10, and 2010-11, but not for 2011-12 and 2012-13 due to lack of valid assessments. HMRC's profit calculations were rejected due to lack of evidence and methodology; appellant's figures accepted as more reliable.

Court Disposition

Appeal allowed in part, dismissed in part.

Orders

  • Discovery assessments for 2005-06 to 2009-10 upheld; assessments for 2011-12 and 2012-13 set aside.
  • Penalties under s 95 TMA for 2005-06 and 2006-07 upheld; penalty for 2007-08 set aside.