Ward v Revenue and Customs (INCOME TAX/CORPORATION TAX : Assessment/self-assessment) [2016] UKFTT 114 (TC) (23 February 2016)

Ward v Revenue and Customs (INCOME TAX/CORPORATION TAX : Assessment/self-assessment) [2016] UKFTT 114 (TC) (23 February 2016)

HMRC was entitled to make a discovery assessment for 2009/2010 due to Mr Ward's careless completion of his tax return regarding residence; Mr Ward was resident but not ordinarily resident in the UK for both years; travel expenses were not deductible as they were not obligatory or necessary for employment; no further foreign tax credit was allowed beyond actual tax paid; penalty determination deferred pending recalculation of tax liability based on ordinary residence finding.

Citation
[2016] UKFTT 114 (TC)
Parties
Appellant: Robert Ward; Respondents: The Commissioners for Her Majesty’s Revenue & Customs
Jurisdiction
United Kingdom
Judgment Date
23 February 2016
Procedural Posture
Income Tax/corporation Tax Assessment/self Assessment Appeal / First Tier Tribunal (tax) Judgment
Outcome
Appeal partially allowed; HMRC entitled to discovery assessment; ordinary residence not established; travel expenses and further foreign tax credit denied; penalty decision deferred.
Legal Topics
Discovery Assessment, Residence and Ordinary Residence, Travel Expenses Deductibility, Double Taxation Relief, Inaccuracy Penalty
Tax Law Discovery Assessment Residence and Ordinary Residence Travel Expenses Deductibility Double Taxation Relief Inaccuracy Penalty

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Parties

Robert Ward

Appellant

The Commissioners for Her Majesty’s Revenue & Customs

Respondents

Procedural Posture

Income Tax/corporation Tax Assessment/self Assessment Appeal / First Tier Tribunal (tax) Judgment

Legal Issues

  1. 1 Whether conditions for a discovery assessment under s 29 TMA 1970 for 2009/2010 are satisfied
  2. 2 Whether Mr Ward was ordinarily resident in the UK for 2009/2010 and 2010/2011
  3. 3 Whether travel expenditure costs are deductible for 2009/2010 and 2010/2011

Ratio Decidendi

HMRC was entitled to make a discovery assessment for 2009/2010 due to Mr Ward's careless completion of his tax return regarding residence; Mr Ward was resident but not ordinarily resident in the UK for both years; travel expenses were not deductible as they were not obligatory or necessary for employment; no further foreign tax credit was allowed beyond actual tax paid; penalty determination deferred pending recalculation of tax liability based on ordinary residence finding.

Court Disposition

Appeal partially allowed; HMRC entitled to discovery assessment; ordinary residence not established; travel expenses and further foreign tax credit denied; penalty decision deferred.

Orders

  • HMRC may make discovery assessment for 2009/2010.
  • Mr Ward to be treated as resident but not ordinarily resident in UK for 2009/2010 and 2010/2011.