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HMRC internal manual

Employment Income Manual

The general rule for employees’ expenses: dealing with expenses: how to resolve a dispute: appeal against assessment

For detailed guidance on the procedures for dealing with tax adjustments such as employees’ expenses look at SCS80/03 “How to examine tax adjustments that are not ITSA claims”.

To resolve a dispute about whether an expense is deductible the employee needs to be brought into SA for the year of the dispute. An SA Return should be issued if one has not already been issued. An enquiry must be opened and you must take care to carry out a risk assessment of the whole of the Return to make sure that the enquiry covers all of the areas of potential risk.

At the conclusion of the enquiry the employee should be invited to amend his or her self- assessment. If the employee does not amend the self-assessment, or the amendment is unsatisfactory, an officer of the Board can make an amendment to the self-assessment. The employee is entitled to appeal against that amendment and any appeal can be taken to the First-tier Tribunal.

Where an assessment for the year in question has become final and conclusive, see EIM31707.

In-year casesTo resolve an in-year dispute about whether a deduction can be given, a coding notice can be issued. The employee can then appeal against that coding notice and the appeal can be taken to the First-tier Tribunal.