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Personal liability notice imposed on director

08 April 2019
Issue: 4691 / Categories: Tax cases
N Farrow (TC7048

HMRC considered Spectrum Ltd of which the taxpayer was a director should have included in its construction industry scheme returns payments it made to various companies referred to by HMRC as umbrella companies but which the taxpayer called service or payroll companies. The taxpayer said this had not been done because after taking advice his understanding was that the construction industry scheme did not apply to such companies. HMRC imposed penalties.

After a review of the case the HMRC officer concluded there were reasonable grounds to suspect Spectrum had fraudulently made an incorrect return. However the decision acknowledged that the department had no direct evidence to support this.

Spectrum went into administration so HMRC sent personal liability notices under FA 2007 Sch 24 para 19 to the taxpayer in respect of the penalties. The taxpayer appealed.

The First-tier Tribunal said it was for...

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