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Alex Revell gives the taxman the run around!



wallyback

Well-known member
Jun 22, 2011
1,406
Brighton
The case concerned Alex Revell, who was in correspondence with HMRC regarding alleged arrears of tax. These related to the tax years 2007/2008 to 2011/2012, during which time he played for a number of different clubs. [Alexander Revell and the Commissioners for Her Majesty’s Revenue & Customs, TC 04887 Appeal number: TC/2015/02550].

The tribunal noted that as he was playing in the lower divisions, Revell’s earnings were relatively modest compared with the rewards given to those who play in the Premier League and all his tax was accounted for through the PAYE system.

In March 2011, HMRC identified an underpayment on Revell’s PAYE record for 2008/09. Although HMRC were aware of his address at the time in Brentwood (from a P45 issued in July 2010) they sent the underpayment calculation to an old address and Revell never received it.

As Revell did not respond to the underpayment notification, in September 2012 HMRC issued a self-assessment return for 2008/09, but again although HMRC had been informed (in a P60 for 2011/12) that Revell had a new address they sent it to the Brentwood address and he never received the return.

In the absence of a completed return, in February 2014 HMRC issued a determination under the Taxes Management Act 1970 (TMA 1970) in relation to the underpayment of tax it contended was due for 2008/09.

As the only way to supersede a determination was to submit a return, Revell submitted a 2008/09 tax return in March 2011 which included a ‘notional credit’ resulting in the return showing that no tax was due for the year.

HMRC purported to open an enquiry into the return and subsequently issued a closure notice removing the notional credit thus increasing the tax due for the year to £16,519.

Revell appealed against the closure notice on the basis that as there had been no valid request to file a self-assessment return as required under TMA 1970, HMRC could not open an enquiry and consequently the closure notice was invalid.

HMRC contended that the return should have been regarded as an unsolicited return and the taxpayer should have been taken to have waived the requirement for a notice.

This was based on this long-standing advice from their solicitors stating: ‘I appreciate that the statutory scheme puts an obligation on the taxpayer to make a return arise [sic] only once he receives a notice which requires him to do so.

‘But in any case in which an unsolicited return has been received, the better view, as it seems to me, is that the taxpayer has waived the formal notice step’.

However, the judge at the tribunal said ‘the correspondence we saw demonstrates a clear lack of rigour on HMRC’s part in getting to the bottom of what happened.’

He said this was evident in a letter sent by HMRC to Revell’s agents in response to what he called ‘well justified complaints’ about how his affairs were handled.

HMRC’s letter stated: ‘Even though I have defended certain of our handling of this case, I admit that we have still not given Mr Revell the service he deserves.

‘Plainly, our shortcomings have affected him particularly badly. Furthermore, I feel our treatment of his complaint including my delay in sending this letter-only aggravated the situation.’

In its ruling, the FTT found that the request to make and deliver a tax return was not served in compliance with the provisions of TMA 1970, because at the time the request was made, the address to which it was sent was no longer Revell’s ‘usual or last known place of residence’ with HMRC having received a more up-to-date address by virtue of its receipt of a form P60 issued for 2011–12. Neither was there any suggestion that the address to which the return was sent was his place of business or employment.

The FTT rejected HMRC’s analysis that by a taxpayer making an unsolicited return the taxpayer had waived the requirement for a notice. It said the legislation made no provision for such a waiver and if parliament had intended the submission of a voluntary return to amount to such a waiver it could have said so.

The FTT also found that the return Revell submitted should have been characterised as a notice of liability to income tax under rather than a self-assessment tax return. Therefore had the time limit for this not expired HMRC could then have issued a request for a self-assessment return.

The FTT concluded that both the notice of enquiry and the closure notice were invalid and the assessment to income tax for 2008/09 had to be discharged.

The tribunal said an enquiry could not be validly opened and thus nor could a closure notice be validly issued because no valid notice to complete a tax return had been made. The notice to complete a tax return had not been sent to the most recent address HMRC had for the taxpayer and the submission of an unsolicited tax return did not mean that the taxpayer had waived the requirement for such a notice.

Meg Wilson, CCH tax writer, commented: ‘In this case HMRC appear to have failed both the taxpayer and the wider UK population. In respect of the taxpayer the FTT noted that the taxpayer had well justified complaints about the manner in which his affairs had been handled.

‘In respect of the UK population as a whole, because HMRC did not use the taxpayer’s correct address and demonstrated a clear lack of rigour in getting to the bottom of what happened when they did not receive a completed tax return it appears that £16,519 of tax that should have been collected has not been collected.’

Wilson also highlighted an additional point, which it was not necessary for the FTT to consider, but which suggested some taxpayers attempting to challenge other determinations could face difficulties.

‘It raised the question as to how a taxpayer could resist a purported determination which he maintains was not validly made because he was not given notice under TMA 1970, section 8, to complete a return.

‘The FTT noted that there was no express right of appeal against a determination notice because it was assumed that the taxpayer's remedy is to displace the notice by filing a self-assessment return, which is what the taxpayer did in this case.

‘But if the taxpayer chose not to take that course, but resisted enforcement of the determination notice, it appeared to the FTT that it would not have jurisdiction in respect of those enforcement proceedings. The FTT regarded that as being not particularly satisfactory,’ Wilson said.
 


Westdene Seagull

aka Cap'n Carl Firecrotch
NSC Patreon
Oct 27, 2003
20,938
The arse end of Hangleton
HMRC - staffed by incompetent buffoons but not nearly as poor as the morons that staff the DWP ( Dicks, W@ankers and Pr1cks ).
 






studio150

Well-known member
Jul 30, 2011
29,555
On the Border
Not only are they buffoons they take ages to do anything when it comes to seeking tax rebates due to overpayment.
 




GT49er

Well-known member
Feb 1, 2009
46,473
Gloucester
HMRC - staffed by incompetent buffoons .................................

Yes, quite probably in many cases - but to be fair, there are now no longer nearly enough of them (buffoons or not) to deal with the work they are required to do. Cuts. They really do exist.......................
 


GreersElbow

New member
Jan 5, 2012
4,870
A Northern Outpost
Anyone who has had to deal with HMRC knows they're ran by muppets. I remember during my apprenticeship having to deal with them regarding a clients VAT, which I rang asking for a date of a rebate. 'Adviser' answered 'you tell me, I don't know'...
 


NooBHA

Well-known member
Jan 13, 2015
8,584
HMRC - staffed by incompetent buffoons but not nearly as poor as the morons that staff the DWP ( Dicks, W@ankers and Pr1cks ).

The only real error by HMRC was not updating the address on their records. Ravell's Agents have clearly continued to make appeals on minor technicalities..................I wonder what their fees at the end for their work may have been. Pretty hefty I would imagine.

The first Return lodged refers to an entry of a ''Notional Tax Credit which reduced the liability to zero'' It doesn't make clear whether that tax credit was a genuine tax credit or not and in fact no tax was actually due. If it was then that should have been the end of it and when HMRC amended it again, a decent Agent would have rang HMRC and got everything cleared up by a telephone conversation, instead of branding letters back and forward.

It is difficult to work out from that synopsis whether Ravell ended up not having to pay tax which would ordinarily have been due. It looks to me that he did but it is not 100% clear

If the notional tax credit was erroneous and a tax liability was due then again the correct liabilities could have been agreed by a similar telephone call. Seems to me that the Agent has been chasing fees in this instance. Yes I agree that HMRC have been slightly neglectful in updating records; however, if the Agent has been using technicalities to avoid a tax liability they should be ashamed of themselves.

We all have tax to pay and people should pay what they are due to pay based on current Tax Legislation. People shouldn't be getting away with not paying tax they owe on minor technicalities.


Here's an excerpt of how such appeals should have been resolved

http://www.bbc.co.uk/news/uk-england-derbyshire-36728759
 
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