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 carelessness in completing his tax return regarding residence; Mr Ward was resident but not ordinarily resident in the UK for 2009/2010 and 2010/2011; travel expenses were not deductible as they were not obligatory or necessary for employment; no further foreign tax credit was allowable as only actual tax paid in Australia was creditable; penalty determination deferred pending further evidence on tax liability.

Citation
[2016] UKFTT 114
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 Decision
Outcome
Appeal partially allowed; discovery assessment upheld; ordinary residence not established; travel expenses and further foreign tax credit denied; penalty issue adjourned.
Legal Topics
Discovery Assessment, Residence and Ordinary Residence, Travel Expenses Deduction, Double Taxation Relief, Inaccuracy Penalty
Tax Law Discovery Assessment Residence and Ordinary Residence Travel Expenses Deduction Double Taxation Relief Inaccuracy Penalty

Case Brief

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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 Decision

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 under s 338 ITEPA 2003

Ratio Decidendi

HMRC was entitled to make a discovery assessment for 2009/2010 due to Mr Ward's carelessness in completing his tax return regarding residence; Mr Ward was resident but not ordinarily resident in the UK for 2009/2010 and 2010/2011; travel expenses were not deductible as they were not obligatory or necessary for employment; no further foreign tax credit was allowable as only actual tax paid in Australia was creditable; penalty determination deferred pending further evidence on tax liability.

Court Disposition

Appeal partially allowed; discovery assessment upheld; ordinary residence not established; travel expenses and further foreign tax credit denied; penalty issue adjourned.

Orders

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