Murat, R (on the application of) v Inland Revenue

Once an appeal against a notice requiring documents or accounts under section 19A of the Taxes Management Act 1970 has been determined, the taxpayer cannot reopen the notice when challenging penalties for non-compliance. Where the appeal confirms the requirement, the statutory 30-day period runs from the making of the determination, rather than its receipt by the taxpayer. A taxpayer may explain that figures are unavailable and provide figures based on the best available judgment; the requirement does not compel false statements or self-incrimination. Requiring business records for tax assessment does not ordinarily engage Articles 3, 4 or 14 of the European Convention on Human Rights.

The claimant, a chartered accountant, challenged a determination of Special Commissioner Wallace dated 29 December 2003. The determination dismissed appeals against four penalties imposed under section 97AA of the Taxes Management Act 1970 for failure to comply with a section 19A notice requiring documents, including a balance sheet.

The claimant had previously appealed against the underlying notice. Special Commissioner Dr Brice dismissed that appeal in May 2000. The issues were whether the original notice could be challenged again, whether the compliance date was correctly calculated, and whether compliance infringed rights under Articles 3, 4, 6 or 14 of the European Convention on Human Rights.

1. Appeal dismissed. The penalty notices were lawful, and the claimant was ordered to pay the Revenue’s costs, assessed at £3,000.
2. Section 19A(11) of the Taxes Management Act 1970 makes the determination of an appeal against a requirement under section 19A(6) final and conclusive. Having challenged the original notice before Dr Brice, the claimant could not challenge its contents again in the penalty proceedings or before the Special Commissioner.
3. Section 19A(10) contains a self-contained code. Where the requirement is confirmed on appeal, the notice operates as though it specified 30 days beginning with the determination of the appeal. Regulation 18(9) of the Special Commissioners (Jurisdiction and Procedure) Regulations 1994 treated the determination as made on the date on which the document recording it was sent. The relevant date was therefore 8 July 2000, not the date on which the claimant received the determination.
4. The requirement to produce a balance sheet did not require false figures. The claimant could state that figures were unavailable and provide figures to the best of his judgment. The requirement served the ordinary tax-assessment function and did not involve criminal prosecution or self-incrimination under Article 6.
5. The Convention arguments failed. The circumstances were far removed from the treatment prohibited by Article 3. Article 4 did not apply to work required in pursuance of civic obligations, and the preparation of a balance sheet was not forced or compulsory labour. The Revenue had treated the claimant in the same way as other taxpayers who might be required to produce business accounts, so Article 14 was not engaged.

The judgment states that the appeal was brought under section 56(6) of the Taxes Management Act 1970 against the determination of Special Commissioner Wallace dated 29 December 2003. The underlying section 19A notice had previously been upheld by Special Commissioner Dr Brice in May 2000.