Taxation logo taxation mission text

Since 1927 the leading authority on tax law, practice and administration

Effect of the Ritchie decision on discovery

09 August 2017 / Helen Adams
Issue: 4611 / Categories: Comment & Analysis
istock-171237659_fmt

Carelessness costs money

KEY POINTS

  • HMRC may issue more than one discovery assessment to a taxpayer for the same tax year.
  • A lack of adequate disclosure may contribute to a finding of carelessness which extends the time limit for discovery assessments.
  • Advisers should check all the legislative conditions for a discovery assessment.

Discovery is an area where case law is plentiful. TMA 1970 s29 authorises HMRC to issue an assessment if the officer discovers an under-assessment of tax or excessive tax relief to ‘make good’ the loss of income tax or capital gains tax. Similar provisions exist in FA 1998 Sch 18 paras 41 to 49 for corporation tax.

The First-tier Tribunal decision in William Ritchie and another (TC5911) sheds further light on when HMRC’s discovery assessments may be ruled invalid and when advisers may be considered careless.

 

Background

...

If you or your firm subscribes to Taxation.co.uk, please click the login box below:

If you are not a subscriber but are a registered user or have a free trial, please enter your details in the following boxes:

Alternatively, you can register free of charge to read a limited amount of subscriber content per month.
Once you have registered, you will receive an email directing you back to read this item in full.

Please reach out to customer services at +44 (0) 330 161 1234 or 'customer.services@lexisnexis.co.uk' for further assistance.

back to top icon