Prutish Gopaul v The Commissioners for HMRC
Decision date: 23 August 2023
Neutral citation: [2023] UKFTT 728 (TC)
Overall AI summary confidence: high
Short overview
This short overview is intended to summarise the case, issues and outcome so far as they are supported by the judgment.
AI confidence in this short overview: high
Mr Gopaul appealed personal liability notices (PLNs) issued by HMRC in respect of VAT and corporation tax arising from his company Milano Pizza. The Tribunal upheld HMRC’s VAT best‑judgement assessments and the deliberate penalties relating to understated turnover and profits, but found HMRC had not proved deliberate omission of s.455 loan‑to‑participator liabilities, reducing the corporation tax PLN. Mitigation was allowed at 56% of the PLR and the total personal liability was reduced accordingly.
Ratio decidendi
This summary is intended to identify the ratio decidendi, meaning the legal reasons for deciding and the binding part of the decision.
AI confidence in this ratio decidendi summary: medium
The Tribunal held that HMRC’s best‑judgement VAT assessments based on downloaded till data were lawful where the taxpayer failed to produce core records or to show the data overstated turnover; and that for Schedule 24 penalties HMRC must prove deliberate behaviour (intentionality) in understating liabilities, with the evidential burden on the taxpayer to challenge the correctness of assessments.
Obiter dicta
This summary is intended to identify obiter dicta, meaning observations made by the way that were not necessary to deciding the case and are not binding.
AI confidence in this obiter dicta summary: medium
The judgment comments that an officer’s receipt of additional information after issuing an assessment may not be treated as part of the assessment decision, and that failure to keep core business records can undermine credibility, mitigation and support findings of deliberate behaviour.