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HMRC’s discovery assessments on taxi driver were valid but overstated

By Mark McLaughlin, April 2021

HMRC’s discovery assessments were valid, in time and properly served and notified, but the appellant was able to displace the assessments by putting forward more likely amounts of taxable profits for the tax years in question.

The appellant, a self-employed taxi driver, was sent notices to file self-assessment returns for the tax years 2009/10, 2010/11 and 2011/12, but failed to submit the returns. Following information received from third parties regarding income received by the appellant, HM Revenue and Customs (HMRC) opened an investigation into his tax affairs.

In June 2014, HMRC wrote to notify the appellant that determinations would be issued for the tax years in question. Subsequently, discovery assessments were sent to the appellant in October 2014. HMRC assessed the appellant’s profit for 2009/10 at £23,696; for 2010/11 at £26,513; and for 2011/12 at 20,721.

The appellant submitted self-assessment returns for

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