Nijjar Dairies Ltd v HMRC

In Nijjar Dairies Ltd v HMRC (TC02828 – 30 August) a company (N) submitted a return claiming to have made a loss in 2005. HMRC formed the opinion that N had claimed deductions for substantial expenditure which was not wholly and exclusively for the purposes of its trade. In December 2011 they sent a letter to N’s accountants purporting to disallow the deductions and stating that they had made ‘protective discovery assessments’. N appealed contending as a preliminary issue that HMRC had not made a ‘discovery determination’ within FA 1998 Sch 18 para 41(2) so that the losses remained available to carry forward. In June 2012 HMRC sent a letter headed ‘notice of determination’ to N. The First-tier Tribunal allowed N’s appeal against this determination holding that it had been made outside the statutory time limit. Judge Sinfield rejected HMRC’s...