UT (Tax & Chancery) UT-2024-000024 - [2025] UKUT 00156 (TCC)

In light of our conclusion above, there is no need to address HMRC’s alternative argument that any mistake in the notices was cured by s83(2) FA 2003. The FTT considered the competing arguments on this issues at [95] – [100]. In particular, whether there is any difference between the common law test based on how a reasonable recipient would understand a notice and the test in s83(2) as to what was reasonably ascertainable by the recipient.

Section 83(2) provides that a notice for SDLT purposes is not ineffective by reason of any defect or omission if it is substantially in conformity with the requirements of the legislation and its intended effect is reasonably ascertainable by the person to whom it is directed:

“Section 83 – Formal requirements as to assessments, penalty determinations etc

(1)

An assessment, determination, notice or other document required to be used in assessing, charging, collecting and levying tax or determining a penalty under this Part must be in accordance with the forms prescribed from time to time by the Board and a document in the form so prescribed and supplied or approved by the Board is valid and effective.

(2)

Any such assessment, determination, notice or other document purporting to be made under this Part is not ineffective—

(a)

for want of form, or

(b)

by reason of any mistake, defect or omission in it,

if it is substantially in conformity with this Part and its intended effect is reasonably ascertainable by the person to whom it is directed…”

Mr Elliott submitted that the ordinary and natural meaning of the term ‘reasonably ascertainable’ imported a lower level of certainty as to the intended effect of a notice than the common law standard to which the recipient must be satisfied . He also submitted that in applying the statutory test, more weight would be given to the actual understanding of the taxpayer.

Mr Chacko submitted that s83(2) added nothing and imported the same test as the common law. The hypothetical reasonable recipient would be in the same position in relation to both tests.While s83(2) FA 2003 applies to a wide range of documents, in the context of a notice there is no real difference between the question whether a reasonable recipient would be left in doubt, and whether the meaning of the notice is reasonably ascertainable. If the reasonable taxpayer reading the documents would have some doubt as to what HMRC intended, then its meaning was not reasonably ascertainable.

We were referred to a decision of the FTT in Coolatinney Development Limited v HMRC [2011] UKFTT 252. However, it is not clear whether the FTT in that case viewed the test under s83(2) as being any different to the common law test. We were also referred to GDF Suez in this context, where the Upper Tribunal indicated that the common law test for validity of a notice should be applied before resorting to the equivalent of s83(2) in s114 Taxes Management Act 1970.

Given our conclusion on Ground 1 and Ground 2, we do not need to determine whether there is any material difference in the application of the two tests. We prefer not to express any view on the issue where it does not affect our determination of the appeal.

For the reasons set out above we dismiss the Appellants’ appeals against the FTT’s Decision.