Expenses refused because of lack of records

The taxpayer claimed expenses relating to his employment as an employed scaffolder in his 2014-15 2015-16 and 2016-17 self-assessment tax returns.

HMRC opened an enquiry into each return asking for evidence of the expenses and how they qualified as allowable.

The taxpayer’s agent said the taxpayer needed specialist clothing for his job but could not provide further information. The mileage claim was based on the best of the taxpayer’s memory.

HMRC issued closure notices denying the expenses and adding car and car fuel benefits to the 2015-16 return. It did allow a flat-rate allowance of £140 a year for tools. It imposed a penalty on the basis that the disclosure was prompted and the taxpayer had been careless.

The taxpayer appealed.

The First-tier Tribunal agreed with HMRC. It found there were discrepancies in the taxpayer’s mileage log making it ‘practically unusable’. It was claimed that 60 000 business miles were...