Notice of enquiry into taxpayer’s return sent to agent

HMRC opened an enquiry into the taxpayer’s 2003-04 tax return under TMA 1970 s 9A. It later issued a closure notice disallowing a loss claimed in the return. The taxpayer appealed against the notice saying it was invalid because he had never been told that the enquiry was being opened.

HMRC disputed this saying it had posted the notification letter to him and had sent a copy of it to BDO his accountants. It was agreed that BDO had received a copy of the notice of enquiry with a covering letter in July 2005 and that BDO was the taxpayer’s agent as indicated on form 64-8. The dispute concerned BDO’s authority to receive the notice of the enquiry on his behalf.

The First-tier Tribunal and Upper Tribunal dismissed the taxpayer’s appeal.

The matter proceeded to the Court of Appeal.

Lord Justice Hamblen delivered the judgment with which Sir Bernard Rix...