SpC 727 (2008) Evolution Group Services Ltd, Chilcott and Griffiths v HMRC

Did S144A ICTA 1988 (now S222 ITEPA 2003) apply - HMRC won.

Case Summary:

S222 ITEPA 2003 is a trap which still catches some people out. When notional payments are made so that an employer must operate PAYE but has no (or limited) employee income from which to deduct tax the employee must make the tax good to the employer within 90 days or be charged to tax on the tax not made good. In this case S144A ICTA 1988 (the predecessor of s222) was held to apply although the Commissioner found its inflexibility surprising.