First-tier Tribunal (Tax)

[2011] UKFTT 104 (TC)

TC00980

Appeal number TC/2010/03533

Application for postponement of tax – whether reasonable grounds for believing Appellant overcharged to tax – application allowed in part – Section 55 Taxes Management Act 1970

FIRST-TIER TRIBUNAL

TAX

HARISH PATEL Appellant

- and -

THE COMMISSIONERS FOR HER MAJESTY’S

REVENUE AND CUSTOMS Respondents

TRIBUNAL: JOHN BROOKS (TRIBUNAL JUDGE)

JAMES MIDGLEY (MEMBER)

Sitting in public at 68 Lombard Street, London EC3 on 26 January 2011

Mr D Amin of Amin, Patel and Shah Accountants for the Appellant

Mr David Wetherall of HM Revenue and Customs, for the Respondents

© CROWN COPYRIGHT 2011

DECISION

1.       This is an application by Mr Harish Patel for the postponement of tax under assessment for the years 1989-90 to 2007-08 as set out in the attached schedule.

2.       We were provided with a bundle of documents by HMRC which included copies of the relevant legislation, the assessments and correspondence between HMRC and Mr Patel’s accountants. Mr Amin provided a copy of a Statutory Declaration made by a Mr N A Patel, a Kenyan national, who is the brother-in-law of Mr Harish Patel.

3.       The assessments, which were made under s 29 Taxes Management Act 1970 (“TMA”), were protective assessments made in respect of interest received from funds held in the name of Mr Harish Patel at a Jersey bank.

4.       The issue for us to determine, in accordance with s 55 TMA is whether there are reasonable grounds for believing that the Appellant is overcharged to tax. It is also worth noting that s 55(6A) provides that “notwithstanding the provisions of sections 11 and 13 of the TCEA 2007, the decision of the tribunal shall be final and conclusive.”

5.       Mr Wetherall, for HMRC, told us that Mr Harish Patel had opened a Jersey bank account on 9 March 1997. Although this account was closed on 3 November 1997 another Jersey bank account was opened by Mr Patel on 3 November 1997.

6.       In the circumstances we consider that there are reasonable grounds for believing that Mr Patel was overcharged to tax by the assessments for the years 1989-90 to 1995-96.

7.       As such we determine that the tax due between 1989-90 to 1995-96 (i.e. that referred to as Case V interest in the schedule below) be postponed and allow the application to that extent.

8.       However, the application, insofar as it relates to tax due between 1996-97 to 2007-08, is dismissed.

9.       This document contains full findings of fact and reasons for the decision. The parties are referred to “Guidance to accompany a Decision from the First-tier Tribunal (Tax Chamber)” which accompanies and forms part of this decision notice.

JOHN BROOKS

TRIBUNAL JUDGE

RELEASE DATE: 3 FEBRUARY 2011

Schedule

Assessments

Year Description Quantum Tax Due

1989-90 Case V Interest £20,000 £8,000

1990-91 Case V Interest £25,000 £10,000

1991-92 Case V Interest £30,000 £12,000

1992-93 Case V Interest £35,000 £14,000

1993-94 Case V Interest £40,000 £16,000

1994-95 Case V Interest £45,000 £18,000

1995-96 Case V Interest £50,000 £20,000

1996-97 Foreign Income £55,000 £22,000

1997-98 Foreign Income £60,000 £24,000

1998-99 Foreign Income £65,000 £26,000

1999-00 Foreign Income £70,000 £25,279.49

2000-01 Foreign Income £75,000 £26,846.58

2001-02 Foreign Income £45,000 £15,688.62

2002-03 Foreign Income £20,000 £6,327.26

2003-04 Foreign Income £20,000 £7,153.64

2004-05 Foreign Income £25,000 £10,000

2005-06 Foreign Income £25,000 £10,000

2006-07 Foreign Income £25,000 £10,000

2007-08 Foreign Income £25,000 £10,000