In Estate 4 Ltd v HMRC (TC01131 – 19 May) HMRC began an enquiry in December 2009 into a return submitted by a company (E) whose accounts showed a turnover of £187 000 and directors’ salaries of £116 500.
A meeting took place in May 2010 and the officer responsible for the enquiry formed the opinion that the salaries shown in E’s accounts were insufficient to meet its directors’ living expenses.
E applied for a closure notice contending that it had already supplied information about its own income and could not be required to provide information about its directors’ personal affairs. The First-tier Tribunal granted the application.
Judge Clark held that there was no ‘basis for continuing to make further enquiries into the level of the remuneration’.
Why it matters: FA 1998 Sch 18 para 33...
