Freeman and discovery assessments

In Freeman v HMRC [2013] UKFTT 496 (TC), the tribunal held that a discovery assessment, raised by HMRC pursuant to TMA 1970 s 29, was invalid because HMRC could have been reasonably expected, on the basis of information available to it at the relevant time, to have been aware of the loss of tax, for the purpose of s 29(5). The tribunal rejected the taxpayer’s argument that the hypothetical officer could reasonably have been expected to check Extel to confirm that securities are QCBs. However, the tribunal decided that a document provided to HMRC in April 2000, in the context of an enquiry into the taxpayer’s 1997/98 return, was ‘information available’ in relation to the 2002/03 tax year. The tribunal’s conclusion that s 29(6)(d)(ii) has no temporal restriction is to be welcomed.