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HMRC opened an enquiry into the taxpayer’s return for 2006/07. He had claimed expenses totalling £17,000; the taxman asked for receipts.
The Revenue also asked for the taxpayer’s construction industry scheme vouchers and copies of his bank statements from his agent, who claimed the records had been returned to the taxpayer.
The taxpayer sent various documentation, but the HMRC officer allowed only £400 in respect of a receipt for diesel. The officer also increased the taxpayer’s net income on the ground the deposits into his bank account exceeded those shown in his return.
The taxpayer appealed. He produced further receipts and invoices. As a result, HMRC adjusted the assessments to allow expenses of £12,523 and capital allowances, with the consequence the taxpayer was due a repayment.
The appeal was allowed in part in accordance with the agreement reached by the taxpayer and the taxman.
