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R and J Birkett trading as The Orchards Residential Home and others v CRC, Upper Tribunal (Tax and Chancery Chamber), 2 March 2017
Jurisdiction of First-tier Tribunal to consider taxpayer’s legitimate expectation
Mr and Mrs Birkett were members of several partnerships each of which operated a residential care home. The partnerships made contributions to a trust under an arrangement intended to reduce their taxable profits. HMRC opened enquiries into the partnerships’ returns and issued information notices under FA 2008 Sch 36. It imposed penalties as a result of the partnerships’ non-compliance with the notices.
The partnerships appealed to the First-tier Tribunal but it lost the papers and HMRC was not notified. It therefore issued daily penalties against which the partnerships also appealed.
The First-tier Tribunal confirmed the penalties and the partnerships appealed to the Upper Tribunal. They said the First-tier Tribunal had erred in law in concluding it did not have jurisdiction to consider Mr and Mrs Birkett’s legitimate expectation that no daily penalties would be imposed after they appealed the...
