Taxation logo taxation mission text

Since 1927 the leading authority on tax law, practice and administration

Lack of awareness of loans to participator provisions

15 September 2023
Issue: 4905 / Categories: Tax cases
P Gopaul (TC8917)

The taxpayer operated a takeaway pizza business through his company Gopaul Ltd.

In 2017 HMRC issued the company best judgment assessments for VAT on the basis that the company had systematically suppressed turnover along with penalties for deliberate behaviour. It also issued a personal liability notice (PLN) to the taxpayer on the ground that the inaccuracies were attributable to him.

HMRC then opened corporation tax enquiries and issued closure notices amended assessments. The latter comprised corporation tax on undisclosed profits and amounts due from the company under the loans to participators provisions at CTA 2010 s 455. It also imposed penalties again on the basis the behaviour had been deliberate and sent a PLN to the taxpayer.

In 2018 the company entered liquidation and was struck off in 2020.

The taxpayer appealed against the PLNs.

The First-tier Tribunal considered HMRC had made a genuine attempt to make a...

If you or your firm subscribes to Taxation.co.uk, please click the login box below:

If you are not a subscriber but are a registered user or have a free trial, please enter your details in the following boxes:

Alternatively, you can register free of charge to read a limited amount of subscriber content per month.
Once you have registered, you will receive an email directing you back to read this item in full.

Please reach out to customer services at +44 (0) 330 161 1234 or 'customer.services@lexisnexis.co.uk' for further assistance.

back to top icon