Closure notices

Enquiries into business premises renovation allowance claims

The taxpayers were limited liability partnerships. The appeal concerned their claims for business premises renovation allowance (CAA 2001 Pt 3A) on properties in Birmingham and Liverpool. This allows taxpayers to claim 100% allowances on specified capital expenditure on the conversion or renovation of unused buildings in a designated ‘disadvantaged area’ for business use. The intention was that losses arising as a result of the claims would be relieved by individual investors against other income as sideways loss relief.

HMRC opened an enquiry and issued partner payment notices to investors in the partnerships. Some of the notices were the subject of judicial review claims. The taxpayers were concerned that HMRC had no incentive to close the enquiries and appealed to the First-tier Tribunal to direct HMRC to issue closure notices on the basis that it held enough information to do so.

The First-tier...