E A Manisty and A Manisty as Trustees of The E A Manisty Furbs Trust v The Commissioners for Her Majesty's Revenue & Customs, TC 01354
| Jurisdiction | UK Non-devolved |
| Judge | Nicholas Aleksander |
| Judgment Date | 26 July 2011 |
| Neutral Citation | [2011] UKFTT 507 (TC) |
| Respondent | The Commissioners for Her Majesty's Revenue & Customs |
| Appellant | E A Manisty and A Manisty as Trustees of The E A Manisty Furbs Trust |
| Reference | TC 01354 |
| Court | First-tier Tribunal (Tax Chamber) |
[2011] UKFTT 507 (TC)
TC01354
Appeal number: TC/2010/865
INCOME TAX – discovery assessment – negligence of appellant – yes –
whether HMRC could reasonably have been expected to have been aware of
relevant facts – no – appeal dismissed
FIRST-TIER TRIBUNAL
TAX
EA MANISTY AND A MANISTY AS TRUSTEES OF
THE EA MANISTY FURBS TRUST Appellant
- and -
THE COMMISSIONERS FOR HER MAJESTY’S
REVENUE AND CUSTOMS Respondents
TRIBUNAL: Nicholas Aleksander (Tribunal Judge)
Mrs R A Watts Davies FCIPD MIH
Sitting in public at 45 Bedford Square, London WC1 on 8 and 9 March 2011
Edward Manisty, a trustee of the Appellant
Andrew Pickering, an officer of HM Revenue and Customs
© CROWN COPYRIGHT 2011
2
DECISION
1. This appeal relates to the taxation of the EA Manisty Funded Retirement Benefit
Scheme Trust ("the FURBS"), and the power of HM Revenue and Customs to raise a
"discovery" assessment in respect of the year of assessment 2006/7. 5
2. The FURBS was represented by one of its trustees, Edward Manisty. For the first
day of the hearing, Mr Manisty was assisted by Laura Coutts as a “Mackenzie friend”.
HMRC were represented by Andrew Pickering, an officer of HM Revenue and
Customs. We heard oral evidence from Mr Manisty and from Mr Paul Callaway, the
HMRC officer who raised the assessment which is the subject of this appeal. In 10 addition we had two bundles of documents submitted in evidence.
3. We would also note that this appeal was the subject of a lengthy pre-trial review
held on 30 September 2010 before Judge Hellier. Following that hearing, directions
were issued by Judge Hellier. Representations were made by the parties in respect of
the directions, and in consequence minor amendments were made to the directions by 15 Judge Hellier. The (amended) directions, amongst other things, limited the
substantive hearing to consideration of the following points:
(1) Whether one or other or both of the conditions in sections 29(4) and (5)
Taxes Management Act 1970 (“TMA”) (taken together with the later associated
subsections) were satisfied; and 20
(2) What the law (having regard to the provisions not only of the Taxes Act but
also the Human Rights Act and any other relevant legal principle) required the
proper form of the assessment to be and whether there were conditions therefore
other than those appearing on the face of section 29 TMA and section 30A TMA;
and 25
(3) Whether the assessment under appeal satisfied the test to be determined
under (2).
4. In view of the limitations imposed by Judge Hellier's directions, we declined to
hear argument from Mr Manisty that HMRC had a duty to correct any "obvious
mistake" contained in the tax return of the FURBS trustees. 30
5. One of the issues before the tribunal was the application of section 29(5) TMA,
and the approach that an “ordinary competent inspector” would take to the
information before him. As noted in Judge Hellier’s directions, evidence of an
experienced officer of HMRC could be material to these issues, but we considered
that Mr Callaway, who was a very experienced HMRC officer (first appointed as an 35 Inspector of Taxes in 1985, and who had worked on trust cases since 1994) was
competent to given evidence on these issues. We declined to admit in evidence the
witness statements of Mr Andrew Pickering or Mr David Smith. Mr Smith is a senior
HMRC manager responsible for its Trusts and Estates division. He generally has no
involvement in the casework relating to individual taxpayers, and had no involvement 40 in this case. He could therefore give no relevant evidence to the Tribunal. Mr
Pickering is the officer conducting this appeal on behalf of HMRC. His only
involvement in this matter has been in the conduct of the Appeal. He had no
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