.png)
.png)
The taxpayer was a partner in a partnership from 1998 to 2003. He did not send in tax returns for the years 1998-99 to 2001-02.
HMRC issued a number of assessments, but he refused to pay.
In January 2003, HMRC therefore presented a bankruptcy petition against him, and a bankruptcy order was made in May.
This spurred the taxpayer into action and he began to submit his self-assessment returns.
HMRC made some mistakes when they assessed his tax liability, and the bankruptcy was rescinded.
HMRC appealed against that decision.
The judge said that the order should not have been rescinded.
The taxpayer had not shown that, had he known about his non-existent liability, he would have applied to annul the bankruptcy under Insolvency Act 1986, s 282(1)(b). Furthermore, there were other unpaid creditors to consider.
HMRC’s appeal was allowed.
