Enquiries into consortium relief may continue

The taxpayers were trading subsidiaries of a shell company. They applied to the First-tier Tribunal for closure notices in relation to enquiries into their claims for consortium relief. HMRC issued information and third-party notices to determine whether the claim were correct. This was on the basis that it considered the anti-avoidance rule in CTA 2010 s 146B (arrangements preventing a link company from controlling the claimant company) might apply and it required the outstanding information to determine the purpose of the arrangements (s 146B(3)(b)).

The taxpayers said the information requested by HMRC in the notices was not relevant to their consortium relief claims so the department should close the enquiries. The First-tier Tribunal decided in favour of the taxpayers but the Upper Tribunal decided it was reasonable for HMRC to continue to make enquiries. The taxpayers appealed.

The Court of Appeal agreed with the Upper Tribunal. Lady Justice Rose was...