Tax cases: VAT

The Tax and Chancery tribunal decision applying the CJEU ruling in the case of Shield and Sons Partnership has been issued

Draft Finance Bill 2015 published

The government has published the draft 2015 Finance Bill.

Reasonable excuse

Generally, a 'reasonable excuse' is when some unforeseeable or unusual event beyond somebody's control has prevented that person from filing the return on time. For example: a failure in the HMRC computer system,a serious illness, disability or serious mental health condition has made the taxpayer incapable of filing the tax return etc.

Robert Smith v HMRC (TC2768) 2013

[20/12/2013] The recent tax first tier tribunal case has caused controversy in the professional press and calls into question whether the 'enquiry window' for opening an HMRC inquiry is still meaningful. Is it as bad as it seems?

VAT: single or multiple supplies

Subjective judgement required to apply the basic principles and guidance, as a recent tax case illustrates.

MacDonald Resorts Ltd v HMRC

This case concerns the place supply of a timeshare operated by Macdonald Resorts in Spain. HM Revenue & Customs won at Tribunal contesting that the place of supply was the UK and therefore at the standard rate of VAT.

McGowan v Brown & cousins

Tests whether a payment constitutes a trading receipt.

Horton v Young

Travelling costs and the wholly and exclusively rule.

Furniss v Dawson

Artificial series of steps inserted purely for the avoidance of tax; consolidated the Ramsay principle established in the case of W.T. Ramsay v CIR

Harrold v Inland Revenue Commissioners

Executor’s of the estate claimed APR on the property but the IR sought to include the value of the property in the estate for IHT purposes.

Ready Mixed Concrete (South East) Ltd v Minister of Pensions and National Insurance

Whether an owner-driver who provided his services to one company for its deliveries was employed or self-employed.

W.T. Ramsay V Cir

Artificial series of steps inserted purely for the avoidance of tax. This is a key case and, together with the case of Furniss v Dawson is a mainstay of HMRC in tackling artificial tax avoidance schemes on the basis of substance over form.

Rowland v HMRC

Whether reliance on a third party (an accountant) can be regarded as reasonable excuse for penalty/surcharge purposes.

Purves v Harrison

Retirement relief; whether a disposal constituted the sale of whole or part of a business.

Smiths Potato Estates Ltd v Bolland

The wholly and exclusively rule.

Samuel Jones & Co (Devondale) Ltd v CIR

This case tests whether an expense is revenue or capital.

Southampton Leisure Holdings Plc v C & E Commissioners

This decision tests partial exemption attribution.

Gilbert (T/A United Foods) v HMRC

Entrepreneurs' Relief; whether there was a sale of "part of a business".

HMRC v Khawaja

Level and quality of proof required by HMRC when levying penalties

United Biscuits (UK) Ltd

This case tests the definitions and exceptions of food.

HMRC v Weald Leasing Ltd

This European Court of Justice (ECJ) decision tests the whether a structure was an abusive practice.

Robertson v CIR, Sp C [2002] SSCD 182

IHT Valuation for a property too low; return subsequently corrected and additional IHT paid; HMRC issued penalties.

Scottish and Newcastle case

This case tests whether an expense can be classed as plant.

Allum & Allum v Marsh

Company purchase of own shares on retirement of directors; whether made for benefit of trade

Temperley v Visibell Ltd

Rollover relief; land acquired; proposed building of factory abandoned; roll-over relief claimed.

Walton v R & C Commrs

Amendments to Self Assessment return by HMRC; whether taxpayer had discharged burden of proving incorrect assessments.

Holden v Wood & Wood

Company incorporated overseas; whether resident in UK by virtue of control.

Salt v Chamberlain

The case tests whether an activity constitutes a trade.

HMRC v Landsdowne Partners Ltd.

Whether a discovery assessment was valid after HMRC discovered that they had incorrectly deducted certain expenses.

Hampton v Fortes Autogrill Ltd

This case tests whether an expense can be classed as plant.

Herbert Smith v Honour

Provision for future rents on vacated premises; whether tax deductible.

Tucker v Granada Motorway Ltd.

This case tests the difference between capital and trading treatment

Barclays Bank Trust Co Ltd v CIR

Business property relief; large cash balance held by company and restriction of relief.

Gordon & Blair v CIR

Change in activity; whether constituted a new trade for the purposes of carrying forward trading losses.

Sargent v Barnes

Travelling costs and the wholly and exclusively rule

R (on the application of Prudential plc) v Special Commissioner (and related applications)

Tax investigations, whether legal and professional privilege could be claimed in respect of certain documentation requested by HMRC during the course of an inquiry.

Benson v Yard Arm Club Ltd

This case tests whether an expense can be classed as plant.

HM Revenue & Customs v The Principal & Fellows of Newnham College in the University of Cambridge

This case tests the meaning occupation in regard to land.

TP Madgett (TP) & RM Baldwin (t/a Howden Court Hotel) v C & E Commissioners

This case tested whether a trade was within the Tour Operators Margin Scheme (TOMS).

Fleming (t/a Bodycraft), Condé Nast Publications Ltd v HMRC

This case looks at the issues of the three year time limit and input tax.

Veltema v Langham

Discovery assessment; whether HMRC permitted to issue one; tax return submitted with valuation subsequently found to be incorrect

Varty v Lines

Principle private residence relief; sale of part of land within curtilege of property following earlier sale of dwelling house and land.

Schofield v R & H Hall Ltd

This case tests whether an expense can be classed as plant.

Garnett v Jones (re Arctic Systems Ltd)

Whether issue of share to wife was a settlement and, consequently, the dividends taxable on the husband.

Batey v Whitfield

Principle private residence relief; sale of an ancillary property, separate from the main dwelling house.

Simpson v John Reynolds & Co (Insurances) Ltd

Tests whether a payment constitutes a trading receipt.

GD Cairns (VDE Webb's Personal Representative) v HMRC

Inadequate valuation of property on IHT return; HMRC issued a penalty summons for negligence; validity of summons.

Attwood v Anduff Car Wash Ltd

Plant and machinery; business use test vs. premises test

Rutledge v CIR

The case tests whether an activity constitutes a trade

Taylor v Good

Property with land acquired and subsequently sold with development value; Trading income vs. CGT.

Walker v Adams

Compensation for loss of office including payment for 'injury to feelings'; whether taxable

Sharkey v Werhnher

This case establishes the principle of value given a disposal other than in ordinary trade.

Imperial Chemical Industries v Colmer

Consortium relief; whether the consortium company had to be a holding company of UK companies only in order to qualify for consortium relief.

Atkinson and Anor v HMRC

Whether absence from a property due to ill health negated a claim for agricultural property relief.

Gallagher v Jones

The wholly and exclusively rule

Rolls-Royce Motors Ltd v Bamford, Ch D 1976, 51 TC 319; [1976] STC 162

Whether trading losses brought forward may be transferred to a subsidiary on transfer buy way of hive-down.

Hall v Lorimar

Freelance vision mixer; whether employed or self-employed.

Mr J R Hanson v The Commissioners of HMRC

The First Tier Tribunal case overturned a penalty for a "careless error" where the accountant was blamed.

Michael J Harte and Brenda A Harte v HMRC

This case was based on whether a property was eligible for main residence relief during a very short period of occupancy.

Anthony Metcalfe v RCC

Private residence relief; multiple properties; house that taxpayer claimed for was not connected to the electricity supply.

Malcolm Springthorpe tax case

This case was based on whether a property was eligible for main residence relief during a short period of occupancy while it was being refurbished.

SDLT and property - a cautionary tale

A cautionary case regarding the apportionment of property and chattels when purchasing a property.

Estate planning, IHT and probate

A look at areas where probate laws in Scotland differ from those that apply in England and Wales.

Out-of-time claims

HMRC has released comments following a recent European Court of Justice (ECJ) case regarding out-of-time claims.

HMRC agent account managers

if HMRC's normal communication channels have left you frustrated and still needing an answer, the Agent Account Manager service may help.

The Upper and First-Tier Tribunals – What is a Reasonable excuse?

The First-Tier Tribunal has made a number of decisions lately which have shown an appreciation of the reality of business life. In Enersys Holdings UK Ltd it was concluded that a Tribunal does have power to strike down a penalty if it is “not merely harsh but plainly unfair” In the face of increased penalties from HMRC, the Tribunals have brought a welcome balance of reason. This page examines some successful and unsuccessful appeal cases.

VAT update - July 2011

VAT and indirect taxes update July 2011.

Badges of trade

A simple concept but despite its simplicity it causes many taxpayer problems clearly indicated by the plethora of case law.

Revenue & Customs Commissioners v Dr Piu Banerjee [2010] EWCA Civ. 843

This case looks at training costs and whether they are wholly, exclusively and necessary

First-tier tribunal tax cases - reasonable excuse

Details of four tribunal cases concerning reasonable excuse.

Reed Employment v HMRC

The first tier tribunal case looks at the supply of temporary staff

Finance Bill 2011 - CPD Article

Read the article on the 2011 Finance Bill and answer the CPD questions to earn verifiable CPD points.

G Bushell v HMRC

Construction industry scheme, penalties for non-submission of CIS returns.

Charlton and Others v HMRC [2011] UKFTT 467 (TC)

The case concerned capital gains tax

IR35 tax cases

Tax cases - whether IR35 applies or not.

R v HMRC

Application for judicial review on ordinary residence rulings; taxpayer met the guidance in IR20 but still had strong connections with UK; interpretation of IR20

Dr Andreas Helmut Tuczka – First Tier Tribunal Case: TC00366

[30/03/10] - Ordinary residence; whether individual coming to UK; acquisition of home in the UK and effects on residence status.

Dr K M A Manzur v Commissioners for HMRC

This first tier tribunal looked at the whether a trade was being carried out

CRC v AXA UK Plc [2010] STC 2825 (C-175/09)

This European Court of Justice (ECJ) decision has prompted HM Revenue & Customs (HMRC) to release Revenue & Customs Brief 54/10.

CM CHAPPEL v HMRC

Business asset taper relief with relevance to Entrepreneurs Relief; transfer of a share of a share in a trading consortium, before trading had commenced and any trading assets acquired.

Cormac Construction Ltd v R & C Commissioners

The case concerns reasonable excuse

Inheritance tax

The House of Lords has approached the Treasury to request new legislation to protect siblings living together for many years in light of the European Courts of Justice decision in the case of Burden & Anr v UK.

Monro v HMRC

Error or mistake claim; refusal of claim where HMRC’s guidance at the time the return was prepared was subsequently found to be incorrect

Danfoss A/S, AstraZeneca A/S v Skatteministeriet CJEC Case

This case looks at a number of aspects concerning entertaining.

Owen v Southern Railway of Peru Ltd, HL 1956, 36 TC 602; [1957] AC 334; [1956] 2 All ER 728

Provision for future obligations; requirement for accurate basis of calculation.

Kretztechnik AG v Finanzamt Linz

This decision tests partial exemption attribution.

J Lyons & Co v Attorney General

This case tests whether an expense can be classed as plant or machinery.

Jackson v Laskers Home Furnishers Ltd

Expenditure on repairs to a leasehold property on acquisition; income or capital.

James Snook & Co Ltd v Blasdale

This case tests the difference between capital and trading treatment.

John Pimblett & Sons v C & E Commissioners

This case tests the meaning of catering.

Jowett v O'Neill & Brennan Construction Ltd

Associated company; whether active for the purposes of reducing small companies’ rate

Kelsall v Investment Chartwork Ltd

Company pension contributions; whether allowable in year of payment or spreading appropriate.

Kieran Mullin Ltd v C & E Commissioners

This decision tests the concept of business splitting.

Kirkby v Hughes

The case tests whether an activity constitutes a trade

Law Shipping Co Ltd v CIR

This case tests whether an expense is revenue or capital.

Leach v Pogson

The case tests whether an activity constitutes a trade.

Baker, Longson v ChD

Eligibility of large garden for private residence relief.

Mallalieu v Drummond

Tests the wholly and exclusively rule and duality purpose.

Market Investigations Ltd v Minister of Social Security

Market research interviewers; employed or self-employed; worker had no conrol over work undertaken.

Markey v Sanders

Principle private residence relief; sale of a property, separate from the main dwelling house.