In Executors of Mrs R W Levy v HMRC [2019] TC07233 the First tier tribunal held that HMRC did not have the power to issue a closure notice where the amount of tax due had not yet been determined.

To formally conclude an enquiry HMRC have to issue a closure notice:

Mrs Levy had made remittance basis claims in her 2014/15 and 2015/16 self-assessment returns. She was UK resident and had lived in the UK for over 45 years but retained a flat in Florida.

The FTT dismissed the appeal on all counts:

The judge here took the exact opposite view to the FTT decision in an earlier partial closure notice case involving the remittance basis, Embiricos v HMRC [2019] TC07083, where the FTT concluded that, unlike with a final closure notice, HMRC can issue a partial closure notice which does not quantify the amount of tax due.

As both cases are FTT decisions neither creates binding precedent but the Court of Appeal in the earlier Archer case confirmed that closure notices which fail to state amounts and do not contain amendments to returns, are defective.

HMRC concluded Mrs Levy had acquired a domicile of choice in the UK despite retaining a property in the USA; they doubted claims her health had prevented her from leaving the UK or that there was any intention to return to Florida as her property there had not been adapted for her needs. The FTT judge felt there was a reasonable case for this view but also agreed that the taxpayer had a credible position, showing how finely balanced and fact specific domicile cases can be.

Links to our guides:

Closure notices 

Non-domicile status, deemed domicile & tax

Schedule 36 information notices

External link:

Executors of Mrs R W Levy v HMRC [2019] TC07233