Elaine Curtis v The Commissioners for HMRC
Decision date: 29 March 2022
Neutral citation: [2022] UKFTT 172 (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
Mrs Curtis transferred a BT pension in 2012 and received a £20,000 payment routed via Blu Funding; the Tribunal found that payment was in substance an unauthorised member payment derived from her transferred pension. HMRC's discovery assessment was held invalid because the statutory conditions for assessing a self‑assessed taxpayer under s.29 TMA 1970 were not satisfied when the assessment was made, and the appeal was allowed; alternatively, had the assessment been valid the Tribunal would have discharged the 15% unauthorised payments surcharge on fairness grounds and reduced the assessment to £8,000.
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
A payment made by a third party can be treated as made from pension scheme assets under s.161 where there is a causal or inextricable link between a scheme investment (here a loan from the FP1 Fund to Blu Funding) and a payment to a member; and a discovery assessment against a taxpayer who has delivered a self‑assessment is invalid unless one of the statutory conditions in s.29(4)‑(5) TMA 1970 (carelessness or inability of an officer to be aware of the deficiency by the time the enquiry window closed) is satisfied at the time the assessment is made.
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 observed that, on fairness grounds, a taxpayer who reasonably relied on independent financial advice and had no reason to suspect an improper linkage between a pension transfer and a subsequent third‑party loan may be entitled to discharge of an unauthorised payments surcharge; and that HMRC should ordinarily open an enquiry within the enquiry window rather than rely on discovery assessments while the window remains open.