Defective notice

HMRC enquired into the taxpayer’s company accounts in 2009 because they included a £700 000 contribution to a remuneration trust.

The tax department issued an information notice in July 2012 under FA 2008 sch 36 after several years of correspondence. It required the business to provide two pieces of information and two documents.

The taxpayer appealed saying it had complied as far as it could and the notice was defective because it asked for subjective opinion “which was not lawfully required to be provided”.

The First-tier Tribunal remarked that information notices should “be expressed in clear terms” so that both parties know whether it has been followed. That was why Revenue guidance stated that notices should request facts and not opinion.

In this instance the notice contained built-in assumptions that “made it impossible” for the company and HMRC to know if the requests had been met...