The taxpayers both directors of the taxpayer company bought cars they needed for business jointly with the company. They personally owned at all times other cars which they used for private purposes.
The company’s tax return for the year ended 30 October 1999 included a note about the jointly-owned vehicles. Both taxpayers’ returns referred to the joint acquisition of the vehicles.
In 2007 HMRC assessed the taxpayer company to Class 1A National Insurance for the years 2001/02 2002/03 and 2003/04 on the cars. They also issued discovery assessments on the directors for the same years.
The taxpayers appealed.
The points at issue were what was the correct tax treatment of the cars should the discovery assessments be upheld and how were the facts distinguishable from those in Christensen v Vasili [2004] STC 935.
With regard to the latter the taxpayers...
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