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Prior to reporting ‘Defendable on Appeal’ to an Inspector, DVs are required to seek approval from the RD/CV(S). DOA reports are used by the RD/CV(S) to consider the merits of the DV’s case and as part of the liaison procedure with the IR Technical Divisions.
In every case where a DOA report is required by Instructions, it will be appropriate for the DV to initially forward the “Case Summary”. In CGT cases and other specific instances it will be appropriate for the DV to complete on “Appeal Report” as detailed in 3 below.
The “Case Summary” is intended to be a brief document containing all relevant information required by the RD/CV(S) and the Inspector. In cases where the standard format is considered to be inadequate or inappropriate Regional advice should be sought before making a DOA report.
All submissions to the RD/CV(S) must be in duplicate. DVs should complete the boxes as follows, singular items being taken as plural as required.
- Office title, location number and case reference;
- HM Inspector of Taxes district and reference;
- The Tax applicable should be shown using the following abbreviations:-
CGT- Capital Gains Tax;
IT - Income Tax;
CT - Corporation Tax;
CA - Capital Allowances;
MEA- Mineral Extraction Allowances
- full address of the property concerned. In multi-property cases the property entered on the Case File cover should be entered together with an indication of the number of other properties involved, part cases should be identified as such;
- The name or designation of the taxpayer;
- A brief description of the event giving rise to the case eg Sale, Gift, Part-Disposal etc;
- Valuation date or dates eg 31.3.1982 etc;
- The nature of the Inspector’s request should be briefly detailed eg Re-Basing/Indexation Valuation. Where Partnership Property etc is not involved delete as appropriate;
- Brief details, such as “Freehold with Vacant Possession”. Where tenure is disputed “Freehold subject to lease (disputed by taxpayer)” is appropriate;
- Brief details eg “Shop with living accommodation” will suffice. In multi-property cases only the properties in dispute should be detailed;
- The amount of the DV’s valuation, eg £100,000 will suffice. This should be the figure the DV regards as defendable, and if it differs for any reason from the figures offered or discussed with the parties “see box 16” should be inserted and the situation explained in that box;
- The amount of the taxpayer’s valuation eg £50,000 will suffice;
- Include acquisition price and date, disposal price and date and any intermediate disposal details if available. A detailed history of the property is not required;
- Details of information required to complete the case eg sight of Agricultural Tenancy Agreement, Lease of Shop etc;
- A brief summary of the items in dispute, eg value of property, basis of valuation tenure etc;
- A brief summary giving details of negotiation together with any offers made or received if different from information contained in boxes 11 and 12. The name of any agents concerned should be mentioned;
- If factual information is in doubt or has not been made available and the DV has had to make reasonable and/or Revenue favourable assumptions these should be briefly detailed. Only if these assumptions will have a negligible affect if incorrect should the ‘rider’ be deleted. (Or in all cases where no assumptions have been made).
- The affirmation by the DV is confirmation that the procedure contained Section 6 of this Chapter has been followed in each case where a DOA report is required. In all disputed cases the DV (or report signatory) should personally review the matter to ensure that:-
- the approach to the valuation is correct in principle and law (after obtaining appropriate advice as necessary);
- the available evidence, whether by way of transactions or other sources (subject to any necessary consents being forthcoming), adequately supports the Opinion of Value, any evidence which could discredit the valuation being sufficiently outweighed by a favourable evidence;
- if evidence is scanty or non-existent, so that the valuation is largely or wholly unsupported, the Opinion of Value is a logical and reasonable one having regard to all the circumstances. The availability of any evidence which could discredit the Opinion of Value, whether or not such evidence is known to the taxpayer, will have a particular significance in such circumstances;
If the DV is not satisfied that the case falls within (a)-(c) above, the valuation should not be regarded as defendable and the DV must reconsider the Opinion of Value as a matter of urgency. The revised defendable Opinion should immediately be notified to the taxpayer and if not agreed the DOA submission should be completed with whatever variations are necessary. (In cases where the DOA figure has not been put to the taxpayer for specific reasons, at the DV’s discretion the revised Opinion need not be notified to them).
When reviewing the case the DV must ensure that any assumptions made (detailed in Box 17) are both reasonable and realistic even though they may be Revenue favourable and that all required enclosures are attached.
- The RD/CV(S) should make such comments as are felt proper in the circumstances to ensure that the Inspector is fully advised. In particular, if evidence is scanty or non-existent so that the case is supported by Opinion, the RD/CV(S) should indicate in Box 19 that the DV has been authorised to amend the Box 18 affirmation appropriately.
- The address, office number, telephone and if appropriate, reference of the RD/CV(S) should be added.
An “Appeal Report” will always be appropriate in addition to a Case Summary in the following cases:-
- In all CGT cases reported DOA under the procedures in Section 6, Part 5;
- In any case that has been referred to the IR Solicitor to be appraised prior to litigation;
- In any case that has been set down for hearing before the Lands Tribunal, Special or General Commissioners;
- If the Inspector, CEO or RD/CV(S) believes that an Appeal Report is required in a specific instance the DV will be requested to provide one.