Weekly case highlights ― 12 July 2021

Produced by Tolley
Weekly case highlights ― 12 July 2021

The following Owner-Managed Businesses guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • Weekly case highlights ― 12 July 2021
  • Income tax
  • Lochurst LLP v HMRC
  • Robert Perlman v HMRC
  • Neil McArthur and another v HMRC
  • Employment tax
  • Bruno Giuliani v HMRC
  • Patrick Mcallister v HMRC
  • VAT
  • Mohammed Zaman v HMRC
  • More...

Weekly case highlights ― 12 July 2021

These are our brief notes and thoughts on cases published in the last week or so which caught our eye and are likely to be of particular interest to tax practitioners. Full case reports and commentary on most of these cases will be included within our normal reference sources in the coming weeks.

Income tax

Lochurst LLP v HMRC

It is rare indeed for a taxpayer to seek an outcome under which a higher amount of tax is due than HMRC is arguing for, but that is the case here. The context is a partnership investment scheme of a similar type to the Icebreaker structure, where losses are found not to be available. Here the taxpayer said that they had been the victim of fraud. If relief for certain payments (which HMRC did not challenge) was disallowed, it would ‘better represent its view of the matter’ and ‘might assist it when bringing proceedings in the courts in respect of the fraud it alleged’.

The Tribunal rejected this on procedural grounds. The partnership’s appeal had been stood behind a lead case under the Rule 18 procedure and as a result, the decision in that lead case was binding on the Tribunal. The contested expenses had been allowed in that case and there were no grounds to apply a different conclusion here even though the taxpayer, for their own reasons, wanted a particular outcome.

Not many readers will want to challenge HMRC on the basis that their clients have not paid enough tax, but all involved in litigation will find the discussion on how the Rule 18 procedure works well worth studying.

Robert Perlman v HMRC

What happens when a taxpayer self-assesses on the basis that they are non-domiciled but HMRC believes that they are UK domiciled? Here HMRC issued information notices to find out details of a person’s worldwide income (which would only be relevant if they were UK domiciled). The taxpayer did not comply,

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