Upper Tribunal Tax and Chancery Chamber

UT (Tax & Chancery) UT-2024-000113 - [2025] UKUT 00165 (TCC)

Fecha: 08-Abr-2025

THE FTT DECISION

THE FTT DECISION

In deciding the appeal, the FTT determined three issues that arose into the validity of HMRC’s enquiries into the share loss relief claim, namely whether:

(1)

the Appellant was entitled to make a claim for share loss relief under s.574 of the Income and Corporation Tax Act 1988 (“ICTA”) for losses incurred in the 06-07 tax year carried back and included on his tax return for 05-06. The FTT decided in favour of HMRC that the Appellant was not entitled to carry back the claim in the 05-06 return and it was to be treated as relating to 06-07 by virtue of paragraph 2(3), Schedule 1B TMA.

(2)

even if the Appellant was not so entitled, the Appellant had made such a claim “in” (as opposed to “on”) his tax return for 05-06 such that HMRC could only enquire into it under s.9A TMA. The FTT decided in favour of the Appellant that the claim for share loss relief had been made in the return so that HMRC were required to have opened any enquiry under s.9A TMA and the enquiry they did open, under Schedule 1A TMA, was invalid.

(3)

even if the Appellant had made the claim in his 05-06 tax return, the Appellant’s claim was required to be included in his 06-07 tax return. The FTT found that this was required such that HMRC were entitled to enquire into the 06-07 return under s.9A TMA 1970 and the enquiry notice for 06-07 was valid.

As a result of finding the Schedule 1A TMA enquiry to be invalid, the only closure notice issue that arose before the FTT was whether HMRC had validly closed the s. 9A TMA enquiry into the Appellant’s 06-07 return. The FTT found in favour of HMRC that the s.9A enquiry was validly closed by a s.28A TMA closure notice because, despite a number of incorrect figures included within it, the reasonable recipient of the notice would understand that the share loss relief claim in respect of 06-07 had been denied in full.

The FTT therefore dismissed the Appellant’s appeal on the basis of the valid enquiry and closure notices under ss.9A and 28A TMA respectively in relation to the tax return for 06-07 which denied all relief.