In this month’s update we report on Guidance from HMRC on identifying who is an “enabler” of tax avoidance; a consultation on “off-payroll” working by contractors; and HMRC’s update to its International Exchange of Information Manual to reflect amendments to the list of reportable jurisdictions for Common Reporting Standards.
We also comment on three recent decisions relating to invalid closure notices; discovery assessments; and IR35
HMRC publishes Guidance on identifying who is an enabler of tax avoidance
On 30 April 2018, HMRC published Guidance that seeks to explain what makes an individual an enabler of tax avoidance under paragraph 7, Schedule 16, Finance (No 2) Act 2017. The Guidance also explains how information which is subject to legal privilege should be dealt with.
Consultation document published on “off-payroll” working by contractors
On 18 May 2018, the Government and HMRC published a consultation document on improving the rules relating to “off-payroll” contractors who work through their own companies. HMRC considers many such contractors to be effectively working as employees who should be taxed accordingly.
HMRC updates “reportable jurisdictions” for Common Reporting Standard
On 25 April 2018, HMRC updated its International Exchange of Information Manual to reflect amendments to the list of reportable jurisdictions for the Common Reporting Standard.
Patel: enquiry and closure notices held to be invalid
In Patel & Anor v HMRC  UKFTT 0185 (TC), the First-tier Tribunal (FTT), in finding in favour of the taxpayers at a preliminary hearing, has held that HMRC had not opened valid enquiries into the taxpayers’ self-assessment returns, as the returns had not been made pursuant to a notice issued by HMRC under section 8(1), Taxes Management Act 1970 (TMA).
Tooth: discovery assessment invalid as no inaccuracy in return
In HMRC v Tooth  UKUT 38, the Upper Tribunal (UT) has confirmed that a discovery assessment issued by HMRC was invalid as the taxpayer’s self-assessment did not contain an inaccuracy and in any event there was no deliberate intent by the taxpayer to bring about an insuffciency of tax.
MDCM Ltd: IR35 does not apply in employment status case
In MDCM Ltd v HMRC  TC 6400, the FTT has allowed the taxpayer’s appeal, concluding that its contractual arrangements were such that its principal employee was not an employee of the ultimate contracting company, for the purposes of IR35.