Richard Monks v The Commissioners for HMRC
[2023] UKFTT 853 (TC)
Assembly Global Networks Limited v The Commissioners for HMRC
3 April 2024
[2024] UKFTT 304 (TC)
First-tier Tribunal
HMRC sent a letter to start a tax investigation. The company said they never got it. The judge said the letter was properly sent, and the company didn't prove they didn't receive it, so the investigation is valid.
Key Facts
- •Assembly Global Networks Ltd (AGN) submitted an amended corporation tax return claiming an R&D credit.
- •HMRC paid the credit and later opened an enquiry.
- •A letter opening the enquiry (Enquiry Letter) was sent to AGN's registered office.
- •AGN claimed non-receipt of the Enquiry Letter, arguing the enquiry was invalid.
- •The Tribunal determined as a preliminary issue whether the Enquiry Letter was served in time.
Legal Principles
Deemed service under the Interpretation Act 1978, s.7: A properly addressed, pre-paid, and posted letter is deemed served unless the contrary is proved.
Interpretation Act 1978, s. 7
Taxes Management Act 1970, s.9A sets out the time limit for issuing a notice of enquiry.
Taxes Management Act 1970, s. 9A
Taxes Management Act 1970, s.115 outlines how a notice of enquiry may be served.
Taxes Management Act 1970, s. 115
Companies Act 2006, s.1139 allows service on a company at its registered office.
Companies Act 2006, s. 1139
Standard of proof is the balance of probabilities.
Re B [2008] UKHL
In cases of automated processes, system evidence can suffice to prove posting.
Qureshi v HMRC [2018] UKFTT 0115 (TC); Barry Edwards v HMRC [2019] UKUT 0131 (TCC)
A deeming provision should not be applied to produce unjust, absurd, or anomalous results unless compelled by clear language.
Fowler v HMRC [2020] UKSC 22
The purpose of a deeming provision is to avoid item-by-item proof of service.
Fowler v HMRC [2020] UKSC 22
To prove non-receipt, the recipient must show the letter was not received at the properly addressed address.
Calladine-Smith v Saveorder Ltd [2011] EWHC 2501 (Ch); R (oao Broomfield) v HMRC [2018] EWHC 1966 (Admin)
Outcomes
Preliminary Issue decided in favour of HMRC.
The Enquiry Letter was deemed served under IA s.7 as it was properly addressed, pre-paid, and posted, and AGN failed to prove non-receipt.