No discovery

Michael Ive ran a restaurant that he incorporated in 2001. The company leased two vehicles: a Land Rover in 2002 and a Range Rover in 2005.

Both leases were in the company’s name. The rental payments were made by the business but charged to Ive’s director’s loan account. He paid all fuel and maintenance bills privately and claimed a mileage allowance for business journeys.

HMRC paid a routine compliance visit in 2007. The officer noted that the cars were provided for Ive and asked for information which Ive’s adviser provided denying that the vehicles gave rise to a benefit in kind charge.

The Revenue issued discovery assessments in May 2010 for the years 2004/05 to 2006/07 on the basis car and car fuel benefits were omitted from the returns. Ive and his company the taxpayers appealed.

The First-tier Tribunal found HMRC knew about the...