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HMRC internal manual

Enquiry Manual

HM Revenue & Customs
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Information Powers: TMA70/S20: Presentation to the Commissioner



The consent of only one Commissioner (not of a quorum) is required. You should obtain formal consent as quickly as possible after failure to comply with an informal request. Clerks may be prepared to deal with consent applications at the end of a routine meeting. It is desirable that special arrangements be made for additional ‘consent’ hearings where necessary to avoid delay.

Section 20(7AB) prohibits a Commissioner who has given his consent to a Section 20 notice from taking part in or being present at any proceedings relevant to any appeal brought by the taxpayer, if the Commissioner has reason to believe that any information which was the subject of the notice is likely to be presented in evidence in those proceedings.

When a notice under Section 20 has been given, the name of the Commissioner who gave the consent should be recorded clearly on the file copy of the notice. On reviewing the case either for listing any subsequent appeal, or prior to the hearing for which an appeal has been listed, you should remind the Clerk to the Commissioners of the provisions of Section 20(7AB), the name of the Commissioner who gave consent, and the date of the Section 20 order. You should at the same time indicate to the Clerk that the Act requires the Commissioner who gave consent to consider whether any of the information required by the notice is likely to be adduced in the appeal hearing, and you should express your own view on the relevance of the information to the hearing of the appeal.

The person to whom the notice is to be issued has no right to be notified of or to be present at the hearing by a Commissioner of the application for consent.

This view was confirmed in ex-parte T C Coombs (64TC 124) and more recently in the Court of Appeal in the case of Morgan Grenfell (TL3633). However you must present in summary form all information relevant to the taxpayer’s case (R v CIR ex parte Archon EM10212 and R v Macdonald TCR 3/99) including written representations EM10109 / EM10123 whether favourable to HMRC’s case or otherwise.

You should be fully prepared to demonstrate to the Commissioner that a ‘reasonable opportunity’ to provide the information under Section 20B(1) has been given. You should have with you all related correspondence when you make the application.

Section 20(8E) requires you to provide the taxpayer with a written summary of your reasons for applying for consent to the giving of a notice under Section 20 EM10113. In order to answer any later allegation that the information given to the Commissioner differed from the reasons given to the taxpayer, when seeking consent from a Commissioner you are advised to work from a brief, preferably typed, a copy of which should be retained, and to prepare a typed note of proceedings afterwards.

You need to be aware of the standard of evidence which a local Commissioner will require. It may be that a Commissioner will look at the application in two stages.

  • First, he will require to be satisfied that it is reasonable to say that particular documents or classes of documents or particulars are relevant to tax liability (Section 20(1)) and
  • Second, that, assuming the documents or particulars are relevant, the officer ‘in all the circumstances is justified in proceeding under this section’ (Section 20(7)(b)).

On the first point, the less immediate the connection which any required document has with the basic business records, the more searching the Commissioner’s questioning and requirements are likely to be. Normally, the establishment of basic flaws in the business records, or the production of a capital statement or record of critical examination of accounts showing unexplained discrepancies or other unsatisfactory features, can be expected to be sufficient evidence.

Particular care should be taken to demonstrate the relevance of the information sought and also the reasonableness of making a check in this particular way.

In ex-parte T C Coombs (64TC124) the House of Lords concluded that the nature of the reasonable opinion need not be correct in fact, it needed only to be reasonable.

You should also consider whether there has been any intrusion into the person’s rights of privacy under Article 8 HRA and the typed brief should specifically address this issue.

If there is intrusion you will need to demonstrate that your request is

  • in accordance with law
  • is necessary and proportionate in the circumstances of the case and the minimum necessary to achieve the aim
  • in the economic interest of the United Kingdom

If your view has been challenged, you should seek advice - see contact link.

If consent is withheld and evidence that the taxpayer’s accounts or returns are wrong is strong enough, you will need to consider what courses remain open to you. You may need to proceed by way of raising further assessments. Exceptionally it may be appropriate to contemplate whether a notice might be issued by HMRC Commissioners under Section 20(2) EM10103.