AH1320 - General Commissioners: Conduct of hearing: Onus of proof and the evidential burden
Onus of Proof
The onus of proof is usually on the appellant. For example, if
an appeal is against a Revenue assessment or amendment the
appellant has to prove that the amendment or assessment is
excessive (TMA70/S50 (6)). If the appellant cannot prove, on the
balance of probabilities, that an assessment or amendment is
excessive, the assessment must stand good (see for example Bookey v
Edwards 55TC486 per Walton J at page 490D). Where, for example, an
appeal is against the refusal of a claim to relief, the onus is on
the appellant to prove that he is entitled to the relief, rather
than for HMRC to prove that he is not.
Where, however, an appeal is against a penalty, for example a
tax geared penalty for making an incorrect return (TMA70/S95(1),
TMA70/S100B(2) prevents TMA70/S50(6) to 50(8) from applying and the
onus of proof is on HMRC to show that the offence has been
committed. The onus as to quantum, however, remains on the
appellant.
In the case of a fixed penalty for a failure to, for example,
submit a return, HMRC must put forward evidence of the failure. The
appellant can either give evidence to show there was no failure or
offer a reasonable excuse for the failure.
Where an assessment is made under TMA70/S36(1) for the
purpose of making good a loss of tax attributable to the
appellant’s fraudulent or negligent conduct the onus is on
HMRC to show fraudulent or negligent conduct by the taxpayer and a
loss of tax attributable to it.
The party on whom the onus of proof rests normally opens the
case before the Commissioners. If a different procedure is
followed, for example in the case of Hurley v Taylor (71TC268)
which involved both NTL and ETL assessments the Inspector opened
and dealt with all years, the statutory burden of proof is not
affected.
Evidential burden
As well as the burden of proof as to quantum on the appellant
there is a second burden, usually called the evidential burden,
that is capable of shifting back and forth during the hearing. Once
evidence has been given, then the evidential burden rests on the
person who would fail if no further evidence were produced.
In a tax appeal this means that when the appellant has put
forward evidence in support of his contentions, you in turn must
put forward evidence which rebuts the appellant's evidence. This is
done partly by cross-examination and partly by introduction of your
own evidence. It is not always necessary to adduce evidence to meet
the evidential burden. It might be sufficient to address the
Commissioners on the basis that they are not obliged to accept
everything they have been told by a witness.
Once all the evidence is in, the Commissioners have to look
at the totality of that evidence and see whether the appellant has
discharged the primary onus of proof which lies on him. If he has
not, the decision must go against him, but if he has then obviously
he will win. It is therefore very important to pay attention to the
way that the evidential burden shifts as the hearing progresses. If
you fail to counter facts and evidence as they emerge you may find
that you have not discharged the onus which has shifted to HMRC. In
investigation cases, see also EM5672/3.
Further guidance
An article on “Evidence, the evidential burden and the
onera of proof” which was written for “The General
Commissioner” by the head of Appeals Unit London is at
AH1325.
See AH2225 and AH2130 for more guidance on the onus of proof
in Self Assessment cases.
