Approach to relevant judicial ruling

The taxpayer appealed against a closure notice and penalty assessment for failure to take corrective action after the issue of a follower notice for losses claimed in the tax year ended 5 April 1999 relating to deeply discounted securities.

The First-tier Tribunal found against the taxpayer. He appealed to the Upper Tribunal saying the First-tier Tribunal had erred in law in its approach to deciding whether Audley (TC1084) was a relevant judicial ruling.

The Upper Tribunal said the First-tier Tribunal had not made an error of law in its approach to the relevance of Audley. In deciding whether another judicial decision was relevant the First-tier Tribunal had extracted the principles and reasoning in Audley and considered what the result would be when those were applied to the facts of the taxpayer. The judges said: ‘It would have made no sense for the First-tier Tribunal to apply that reasoning...