Dramatic Extension Of HMRC Powers Confirmed

In R (oao Glenn & Co (Essex) Ltd) v Commissioners of HMRC [2010] EWHC 1469, it has been confirmed by the High Court that HMRC officers can potentially remove computer equipment without the need for a search warrant.

The case concerned the extended definition of "document" contained in section 114 Finance Act 2008. Removal of computer equipment has traditionally taken place pursuant to a search warrant but, for the purposes of HMRC's new information powers, section 114 FA 2008 now extends the definition of "document" to "anything in which information of any description is recorded".  This was interpreted as allowing HMRC to seize (albeit temporarily) 19 computers and a server whilst visiting premises because information was recorded on those items. This is despite the fact that there is a specific provision in section 114 FA 2008 which provides for on-site access to computers without them being removed.