1995 – HMRC u-turn results in apology for raising £50,000 tax assessments!


Summary of Case: December 1992

1.1 Assessments raised by HMRC (Edinburgh 7 District) on taxpayer operating a restaurant business in Edinburgh for 1987/88 to 1993/94 resulting in liabilities exceeding £50,000.00.

1.2 After one year of protracted correspondence and negotiations failed to reach a satisfactory conclusion, the matter was listed for hearing by the “General Commissioners of Taxes” in Edinburgh on Tuesday 18 January 1994.

The defence prepared for the client was summarised on 16 A4 pages and had 124 appendices in support of the case.

The District Inspector requested an adjournment as the defence prepared by James Wright & Co would need a full day to be heard.

1.3 The case moved on from the initiating Inspector of Taxes to the Investigation Manager and ultimately to the District Inspector who spent a month reviewing the case after James Wright & Co had requested that the case be heard by the “Special Commissioners”

1.4 In May 1995, the District Inspector, conceded defeat and offered a full apology (without a trial) and withdrew all of the assessments.

1.5 The apology from HMRC was accepted and no request was made for costs, although the client could have secured this, for a distressing saga lasting over 2 years.