Fishing for information was not permitted

After it opened enquiries into the taxpayer’s returns for 2016-17 and 2017-18 HMRC issued information notices (FA 2008 Sch 36) for both years against which he appealed. The notices sought information and documents in connection with household expenditure such rent utilities food and holidays; financial information including details of director’s loan accounts and sums drawn down from any trusts partnerships and other individuals; and personal financial accounts such as bank and building society statements.

HMRC considered that according to the tax returns the taxpayer’s income appeared to be insufficient to meet his cost of living and personal expenditure ‘by a significant margin’. The taxpayer said HMRC was engaged in a ‘fishing expedition’ and that a notice could not be issued for that purpose.

The First-tier Tribunal agreed that HMRC was not permitted to make broad requests for the purpose of...