Anthony Calcutt v The Commissioners for HMRC
Decision date: 1 September 2022
Neutral citation: [2022] UKFTT 313 (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 opened an enquiry into the appellant’s 2014/15 return, found unexplained bank deposits and suppressed takings across 2010/11–2014/15, and raised s.29 discovery assessments for 2010/11–2013/14, deliberate-inaccuracy penalties for 2010/11–2014/15, and a best-of-judgment VAT assessment for 1 April 2011–31 July 2015. The Tribunal found the officer had discovered a significant loss of tax, that the discovery assessments were valid and timely, upheld the deliberate-penalty determinations (classified as “deliberate but not concealed” with a 60% reduction for quality of disclosure), and upheld the VAT-registration liability and output-based VAT assessment. The appellant’s inconsistent explanations and failure to produce credible records meant HMRC’s figures and inferences from bank records and invoices stood. The appeal was dismissed.
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
Where an open s.9A enquiry reveals suppressed takings across multiple years and the taxpayer fails to produce credible records to displace HMRC’s inferences, an officer may apply the presumption of continuity and make s.29 discovery assessments for earlier years; likewise, HMRC’s best-of-judgment VAT assessments based on bank records and invoices will stand absent positive demonstration by the taxpayer that they are incorrect.
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 the presumption of continuity can, in some cases, yield a more favourable allocation of takings between years than strict year-by-year analysis, and that reductions for “quality of disclosure” may be appropriate where disclosure was prompted by enquiries but nonetheless had some mitigating value.