Commentary

A6.713 Discovery—burden of proof

Administration and compliance

A6.713 Discovery—burden of proof

A6.713 Discovery—burden of proof

The discovery provisions allow an HMRC officer to make an assessment to recover a loss of tax where certain conditions are met1. A discovery assessment is often used if the time limit to open an enquiry into the matter has passed. For details of the conditions, see A6.703.

The commentary below discusses the burden of proof in discovery cases.

Burden of proof

The burden of proving that the conditions for the issue of a discovery assessment are met lies with HMRC. See Gaughan2, where the Special Commissioners decided that HMRC had not discharged the burden of proving that there was a loss of tax.

See also Burgess3, where the Upper Tribunal found that discovery assessments should be reduced to zero, even though under-declarations were established. It found that HMRC had failed to discharge the burden of proving that the conditions for a discovery assessment were satisfied, and also that the First-tier Tribunal had erred in law in not themselves making this finding. The result was that the assessments could not be regarded as valid and the

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