Documents required under information notices

The taxpayer appealed against two information notices (FA 2008 Sch 36). In particular it argued that not all the documents were reasonably required.

The First-tier Tribunal said the legislation was ‘clear’. HMRC could obtain documents if the notice satisfied Sch 36 para 1 and they were reasonably required. So statutory records requested had to be ‘relevant to the issues that have prompted the enquiry and be capable of enabling the officer to check the tax position’. The tribunal considered that a request may be unreasonable if say HMRC requested the statutory records relating to all employees of a company to enable it to verify the position of a single employee or only one aspect of the corporation tax or VAT return.

In this case the tribunal said it was unreasonable of HMRC to request every VAT record to check the VAT treatment of royalties –...