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HMRC internal manual

Specialist Investigations Operational Guidance

Statutory basis for closing an investigation: appeals: conduct of appeal

There are also some particular points to make:

  • Private side discrepancies are not in themselves proof of fraudulent or negligent conduct - so when the onus of proof is on us we have to show that a return, a self-assessment or accounts are incorrect.
  • Evidence from an SI Accountant can be invaluable in demonstrating this.
  • Once the accounts and the like are proven to be incorrect, even in a limited way, then the private side statements can be put forward as evidence of quantum.
  • Difficulty may arise in putting forward private side statements of a director in company appeals. Linkage of an omission from the company’s accounts to the director’s private side can be vital (for example if we can match an omitted company sale receipt to an unidentified credit in the director’s private bank account).
  • Cross-examination of the appellant is important. The main areas of contention (for example a gambling story) are likely to be known in advance but very careful notes should be made of exactly what is said by the appellant when examined. Evidence we do not accept must be challenged in cross-examination otherwise the appellant’s explanation will be accepted by default.
  • Contentious appeals are concerned with a dispute over facts. The tribunal is the arbiter of fact. Usually therefore it is pointless to seek to appeal against the tribunal’s decision. This should not be done unless a material point of law is involved.

Where alternative assessments have resulted in the confirmation of one and the discharge of the other, you may need to consider meeting an appeal by the taxpayer with a cross- appeal. You should seek guidance from the SI Appeals & Review team.