HMRC have published the responses received to their consultation "Tax Enquiries: Closure Rules". It considers whether HMRC should be able to refer certain matters during an enquiry to the tribunal in order to bring about a swifter resolution.

Under the current rules, HMRC require the consent of the taxpayer, during an enquiry, in order to refer a single aspect to the tribunal where there are other issues that have not been resolved.

The consultation document proposed that HMRC be given a unilateral power to issue a tribunal referral notice (TRN) in respect of a single issue in these circumstances. Following subsequent issue of a tribunal referral closure notice (TRCN), the tax due in respect of the TRN aspect would become payable.


Respondents were generally in favour of a mechanism to close particular individual aspects of enquiries. There were two overwhelming views:

  • firstly that any partial closure power should not rest exclusively with HMRC; and
  • secondly that the safeguards regarding the use of any power should be more comprehensive and explicit.

Concerns were also raised about the safeguards proposed not being sufficient to prevent HMRC from cherry picking particular cases to set legal precedents, or to use to taxpayers’ disadvantage.

Some respondents suggested that existing legislation at S28A TMA 1970 could be amended to include a provision for a partial closure notice so that individual issues could be agreed and closed accordingly.

HMRC view and next steps

HMRC proposes to proceed on the basis that there is a need to provide a partial closure provision however it is unclear how this can best be achieved. 

They will now develop some alternative models for stakeholder consultation. Although these changes were planned for FA 2016, this may mean that new legislation is delayed until FA 2017.


HMRC Response to Tax Enquiries: Closure Rules