Thariw Mohammed v The Commissioners for HMRC
Decision date: 14 March 2025
Neutral citation: [2025] UKFTT 331 (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 HMRC discovery assessments and penalties for 2001–02 to 2015–16. The Tribunal found the Happy Chip was a partnership in which Mr Mohammed received the greater share of profits, rejected that assessed bank funds belonged to others, allowed capital allowances and set the 2005–06 assessment aside as out of time, increased three years' assessments under TMA s 50(7) for Santander receipts, and upheld many penalties (with some abatements and reductions). Final recalculated assessments and penalties were recorded (with a short period allowed to correct calculation errors).
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
From the judgment the Tribunal applied and indicated these binding propositions: (1) a taxpayer disclosure or later claim under TMA s 36(3) that alters an assessment can change the applicable time limit for that part of the assessment (so the nature of the error disclosed affects whether a 6‑ or 20‑year limit applies); (2) the Tribunal may rely on other tribunals' judgments for factual matters about claims and outcomes but must make its own primary credibility findings; and (3) under TMA s 50(7) the Tribunal must increase assessments where evidence before it shows the appellant is undercharged, regardless of who produced the evidence.
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 remarked (not as binding ratio) that it has no power to mitigate penalties by reference to taxpayer behaviour after an appeal is notified to the Tribunal, that HMRC ought to give reasons when concluding no “special circumstances” exist for mitigation (failure to do so may render the decision reviewable), and that assertions of linked or joint accounts unsupported by contemporaneous third‑party evidence are not a credible basis to reallocate assessed income.