TC09512 - [2025] UKFTT 00522 (TC)

Fecha: 11-Abr-2025

Quantifying the turnover

Quantifying the turnover

58.

As noted above the Appellants’ disclosure was based on cash deposits made into various bank accounts. The Appellants’ position was that they had paid all sums of cash received by them into the accounts. They identified the amounts said to be income from UK and overseas property. They adjusted the balance of deposits for sums that they claimed was attributable to a share sale, cash dividends, rent a room income, loans received, asset disposal, share sale, and cash salary.

59.

Whilst Mr Hossin accepted that there was no evidence to support the position that all cash had been paid in and that bank statements were missing it was submitted that the income adjustments should be made on the following bases:

(1)

Rent a room income: it was claimed that the Appellants had rented rooms out in both their matrimonial homes. HMRC had accepted that position regarding the second home and should be prepared to accept it for the first home at Flansham House. They contended that they had let out the bedroom in the one bedroomed flat themselves living in the living room.

(2)

Company records established that dividends had been declared. The total dividend shown as paid by bank transfer in the bank statements demonstrated that it had not been fully paid it was therefore reasonable to assume that the balance had been paid in cash and deposited into the bank account.

60.

The following explanations were given to substantiate claims for deductible expenses:

(1)

DCA expenses: these were sums said to have been paid on behalf of SACL/its students and in respect of which cash had been deposited.

(2)

Accountancy fees: said to have been incurred in connection with preparation of income and expenditure accounts.

(3)

Overseas travel: the business of recruiting students required travel to Bangladesh. Copy passports demonstrated that the travel had occurred, and it was reasonable to estimate each trip as costing £500.

(4)

UK travel expenses: the nature of the recruitment business necessitated travel to Manchester and Birmingham on a weekly basis. 125 miles travel had been used as a proxy for average milage.