Requirements in information notice were too wide

The taxpayer had refinanced a debt by issuing a Eurobond to PH LLP which then borrowed the same amount from PHGCM. The LLP then transferred the Eurobond to PH Barbados. The taxpayer claimed tax relief on the interest paid on the Eurobond.

HMRC opened enquiries to establish whether the interest had an unallowable purpose within CTA 2009 s 441 and s 442. It issued an information notice (FA 2008 Sch 36) which rather than describing the information or documents to be produced required the taxpayer to carry out an email search using a list of specific terms and to provide all of the resulting emails to HMRC.

The taxpayer engaged PwC to carry out the search which produced over 11 000 results. After a review PwC identified 1 695 emails which it considered relevant and these were provided to HMRC.

On the same day...