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

The present case should have been distinguished on its facts from Derry CA.

Mr Grierson submitted that the FTT came to the right conclusion for the right reasons at [72] to [74]. He argued that the enquiry into the Appellant’s 05-06 return opened by HMRC under paragraph 5, Schedule 1A TMA to enquire into the Appellant’s claim under section 574(1)(b) ICTA was not competent or valid. The power to enquire under paragraph 5, Schedule 1A to TMA 1970 only applies to “Claims Not Included In Returns”, whereas the Appellant’s claim was included in his 05-06 return as it was relevant information that went to the amount of tax chargeable per Derry CA at [57]. Derry CA was directly binding on this point for the reasons the FTT explained.

He therefore contended that HMRC’s Closure Notice dated 25 July 2019 into the Appellant’s return for the earlier year 05-06, purportedly made under paragraph 7, Schedule 1A TMA, was not valid. The Closure Notice was not founded on a valid enquiry into the Appellant’s return for the earlier year 05-06.