Out of time

Whether an HMRC letter constituted a closure notice

The taxpayer submitted her 2006-07 self-assessment return in January 2008. This showed a tax liability of about £18 000 which she paid. However in October 2011 the taxpayer believed the amount due was the result of a mistake and claimed repayment under TMA 1970 Sch 1AB (overpayment relief). HMRC rejected the claim as out of time.

The First-tier Tribunal struck out the taxpayer’s appeal. The Upper Tribunal said HMRC’s letter to the taxpayer telling her that the claim had been rejected constituted both a notice of enquiry and a closure notice which entitled her to appeal under TMA 1970 Sch 1A para 9(1). The case was remitted to the First-tier Tribunal. HMRC appealed.

The Court of Appeal disagreed with the Upper Tribunal that HMRC’s letter served as notices of opening and closing an enquiry. HMRC had to...