De Silva – Supreme Court Upholds HMRC’s Assessment as Valid in Carry-Back Claims

26 February 2018
Author: JHA

R (De Silva & Anor) v Commissioners for HMRC [2017] UKSC 74 involved an HMRC enquiry into two taxpayers’ partnership affairs. The taxpayers had sought relief for loss incurred in a later year by carrying it back to an earlier year. The taxpayers claimed that HMRC could only conduct an enquiry under Schedule 1A to the Taxes Management Act 1970 (“TMA”), which covers claims not included in the return, and under that provision the statutory limit for carrying out the enquiry had lapsed.

The Supreme Court dismissed the appeal. It held that under other provisions in the TMA, HMRC was entitled to enquire into anything contained or required to be contained in the tax return, including the carry-back claims contained in the later year’s tax returns, and therefore HMRC was not required to launch an enquiry under Schedule 1A to challenge the claims. De Silva was soon applied by the High Court in B Knibbs and others v HMRC [2018] EWHC 13 (7 February 2018).

This article appears in the JHA February 2018 Tax Newsletter, which also features:

  1. C‑398/16 and C‑399/16 X BV and X NV on the Dutch Fiscal Unity Regime
  2. C‑685/16 EV – German Participation Exemption for Dividends Breaches EU Law
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