Revenue’s failing

Lansdowne Partners Ltd Partnership a fund manager submitted a partnership statement for the year 2004/05 which included rebated fees paid to the partners.

HMRC treated the rebates as deductible expenditure but subsequently in 2008 amended the statement on the basis The rebated fees were not deductible.

The partnership appealed claiming the Revenue were late in opening an enquiry into the 2004/05 partnership statement becasue the closed on 31 January 2007. The department claimed the discovery provisions in TMA 1970 s 29 and s 30B applied.

The General Commissioners allowed the taxpayer’s appeal so HMRC appealed to the High Court which found for the taxpayer.

The case moved on to the Court of Appeal which ruled that the rebates paid to the limited partners of the partnership...