John Harvey & Anor v The Commissioners for HMRC
Decision date: 6 December 2024
Neutral citation: [2024] UKFTT 1098 (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
This appeal concerned whether £800,000 of donations by Mr John Harvey to a charity in 2016–17 qualified for Gift Aid and whether HMRC validly raised discovery assessments under s29 TMA. The Tribunal found the donations were not "qualifying donations" because they were conditional/associated with the charity acquiring repayment rights from a person connected to the donor (Condition E) and benefits accrued to a connected person (Condition F), and it upheld HMRC’s discovery assessments against Mr Harvey. The charity’s closure notices were otherwise dismissed but were varied to £75,000 each by concession.
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: high
The decision turns on a purposive, broad construction of ss416(2)–(5) ITA: Condition E is breached where a gift is conditional on or associated with the charity acquiring rights (including loan/repayment rights) from a person connected to the donor, and Condition F is breached where benefits associated with the gift are received by a connected person; accordingly such gifts are not "qualifying donations." Separately, for s29 TMA discovery assessments the tribunal accepted that an assessing officer who honestly and reasonably concludes there has been a loss of tax can validly raise discovery assessments even if the precise statutory pathway is articulated later, so long as a hypothetical officer could not, on the information available by the relevant cut‑off, reasonably have been aware of the insufficiency.
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 notes (obiter) that a Ramsay/purposive approach to statutory construction can be applied to Gift Aid conditions and that analysing the statutory conditions individually or as a composite may reach the same outcome. It also observes that HMRC informal enquiries are lawful and may be relevant to what information was "available" for discovery purposes.