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ground 5: loss of tax brought about carelessly
ground 5: loss of tax brought about carelessly
The assessments and notices issued by HMRC to Mainpay for the tax years ended 5 April 2011 and 5 April 2012 were issued more than 4 years after the end of the relevant tax year. In those circumstances, they would have been out of time unless the extended 6-year time limit in section 36 TMA applied. Section 36(1) TMA provides as follows:
An assessment on a person in a case involving a loss of income tax or capital gains tax brought about carelessly by the person may be made at any time not more than 6 years after the end of the year of assessment to which it relates (subject to subsection (1A) and any other provision of the Taxes Acts allowing a longer period).
Section 118(5) TMA states as follows:
For the purposes of this Act a loss of tax or a situation is brought about carelessly by a person if the person fails to take reasonable care to avoid bringing about that loss or situation.
This issue related only to the 2010 Contract, since that was the contract which was relevant to the assessments for the tax years ended 5 April 2011 and 5 April 2012.
- Heading
- Introduction
- summary of relevant facts
- The 2010 Contract
- The 2013 Contract
- Obtaining assignments
- The process for paying subsistence expenses
- The requirement for consent to other employment
- Length and number of assignments
- the ftt’s determination of the issues
- grounds of appeal
- deductibility of subsistence expenses: relevant legislation
- ground 1: the 2013 contract was an overarching contract of employment
- Mainpay’s argument
- Discussion
- ground 2: a single employment contract
- The FTT’s decision
- Relevant legislation
- Mainpay’s arguments
- Discussion
- ground 3: meaning of “permanent workplace”
- The FTT’s decision
- Mainpay’s argument
- Discussion
- ground 4: use of benchmark scale rates
- Relevant legislation
- The FTT’s decision
- Mainpay’s argument
- Discussion
- ground 5: loss of tax brought about carelessly
- What the FTT decided
- Mainpay’s arguments
- HMRC’s pleading of carelessness
- Failure to take reasonable care
- Causation
- Reliance on Mr Hugo
- Conclusions