Information notices under FA 2008, Sch 36

The taxpayers were directors of a company and made individual self-assessment tax returns for 2015-16 showing identical income from employment and UK dividends. HMRC opened enquiries into both returns. It requested various documents some of which the taxpayers provided but others that they objected to. The department issued notices under FA 2008 Sch 36 for personal banking information and investments. The taxpayers appealed. They said HMRC was using ‘a sledgehammer to crack a nut’ and a proportionate approach would have been to ask for an explanation of any inaccuracies.

The First-tier Tribunal said Sch 36 introduced a test of reasonableness and it was not possible to lay down a general rule of what might be considered reasonable in enquiries generally. 

In this case HMRC had identified a discrepancy in the taxpayers’ self assessments and there was nothing disproportionate in requiring them to provide personal bank statements. Further the...