Complete Case Details Provided Below
Case Summary
Redmount Trust Company Ltd v HMRC (STAMP DUTY LAND TAX – Sub-Sale Relief – Validity of Enquiry and Closure Notice) [2023] UKFTT 27 (TC) (05 January 2023). Cite as: [2023] UKFTT 27 (TC).
Introduction
Redmount Trust Company Ltd’s appeals against HMRC’s Stamp Duty Land Tax (SDLT) assessments were dismissed by the First-tier Tribunal.
Example scenario where this case law principle is relevant
This case illustrates the principle’s application in situations where a company implements a tax avoidance scheme related to SDLT, which is then challenged by HMRC through retrospective legislation and assessments. The company appealed against both a closure notice and a discovery assessment related to SDLT due on a property transaction, arguing the assessments were invalid due to procedural grounds and time limits.
The legal principles agreed upon
The Tribunal found that the tax avoidance scheme was ineffective in avoiding SDLT liability, even before considering the retrospective amendment that explicitly targeted such schemes. It was determined that the company’s land transaction return was not “voluntary” but required under law, thereby validating HMRC’s enquiry and subsequent closure notice. Additionally, the Tribunal found that HMRC’s discovery assessment was validly issued within the appropriate time limits, dismissing the company’s argument that it was out of time.
General summary
The Tribunal’s analysis focused on the effectiveness of the tax avoidance scheme, the nature of the land transaction return filed by the company, and the timing of HMRC’s discovery assessment.
It concluded that the scheme did not achieve its intended tax avoidance outcome, and the return filed by the company was indeed required under the SDLT legislative framework, thus allowing HMRC to enquire and amend the return through a closure notice.
Furthermore, the Tribunal found that HMRC’s later discovery assessment was issued within the statutory time limits, addressing a new legal argument raised by the company. This decision underscores the importance of the statutory framework governing SDLT and the limited circumstances under which HMRC can issue assessments beyond the normal time limits.
Complete Case Details.
| Decision Number: | TC 08390 |
| Appellant: | REDMOUNT TRUST COMPANY LIMITED |
| Respondent: | Her Majesty’s Revenue & Customs |
| Chairmen / Special Commissioners: | Dr Heidi POON |
| Date Of Decision: | 20/01/2022 |
| Main Category: | PROCEDURE |
| Main Subcategory: | Other |
| Notes: | STAMP DUTY LAND TAX – sub-sale relief – s45(3) FA2003 – retrospective amendment to s 45(1A) by s 194 FA 2013 – whether the scheme effective pre-amendment for the original contract to be disregarded to render the return -˜voluntary-™ – whether valid enquiry opened – whether the closure notice invalid consequent on a return being -˜voluntary-™ – whether closure notice in any event subject to a four-year time limit – s 75A FA 2003 anti-avoidance provisions – whether discovery assessment valid and within the time limit – appeals dismissed |
PDF Copy: [2022] UKFTT 38 (TC)
