Adequate protection

Right to a separate hearing on the conditions for discovery

The taxpayer sold a large tranche of shares in May 2000 having moved to Monaco two months earlier to try to mitigate the capital gains tax on the disposal.

In January 2007 HMRC raised a discovery assessment (TMA 1970 s 29) on the taxpayer to capital gains tax on the disposal of his shares. It also issued a notice of determination of ordinary residence for 2000/01 and 2001/02. The taxpayer said he had the right to require the Revenue to show at a separate preliminary hearing before the appeal against the discovery assessment that it had satisfied the conditions for such a procedure.

The First-tier Tribunal said there was no such right. The Upper Tribunal agreed saying whether there should be a separate hearing was one of case management discretion not of right. The...