An authorised officer must have the approval of the Tribunal before issuing an identity unknown notice unless the notice is issued to either:-
- A parent undertaking to check the tax position of one or more subsidiary undertakings
- The notice is given to a partner for the purpose of checking the tax position of one or more other partners.
The conditions that have to be met before the Tribunal can give its approval for an identity unknown notice are set out in FA 2008, Sch. 36, para. 5 (4) and are as follows:-
- The identity of the person or the individual identities of a class of persons are not known to the officer
- There are reasonable grounds for believing that those persons have failed, or may have failed to comply with a tax provision
- Failure to comply with the tax provision is likely to have led, or to lead to, serious prejudice to the assessment or collection of UK tax
- The information or document cannot be readily obtained from anywhere else.
HMRC would consider that there was a serious prejudice to the collection or assessment of tax if there was a risk of:-
- Tipping off a person suspected of committing a serious civil offence
- The loss of significant amounts of tax.
Where the Tribunal gives approval, the notice must say so.
Call Kinsella Tax Investigations NOW on 0800 471 4546.