New Claire Wine Ltd v The Commissioners for HMRC
Decision date: 4 January 2024
Neutral citation: [2024] UKFTT 14 (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
HMRC issued discovery corporation tax assessments, VAT assessments and deliberate‑inaccuracy penalties against New Claire Wine Ltd based on a stock‑flow exercise and material extracted from an Italian server linked to The Italian Wine Company (TIWC). The First‑tier Tribunal admitted the Italian server material, found HMRC’s VAT assessments were made to the best of their judgment, and upheld the Schedule 18 discovery assessments and penalties (with a limited arithmetic adjustment). The appeals were dismissed in principle and quantum was remitted to the parties to agree, failing which the Tribunal will determine it.
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, under Tribunal Procedure Rule 15, evidence (including business records obtained from a foreign seized server) may be admitted even if it would not be admissible in civil proceedings, and that where a taxpayer’s records are inadequate an officer may validly make discovery assessments under Schedule 18 and best‑judgment VAT assessments; the presumption of continuity may be applied absent adequate rebuttal. It also found that where the material and conduct demonstrate deliberate behaviour (or at minimum carelessness) the taxpayer may face deliberate‑inaccuracy penalties.
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 Tribunal expressed views (not essential to the decision) that allegations TIWC had manufactured records for identity fraud were implausible on the balance of probabilities, that related criminal convictions may assist but are not necessary for civil admissibility, and that Article 6/8 ECHR arguments did not assist the appellant in routine tax assessment proceedings.