6.2.1 Overview

The prevailing practice defence is to ensure that a discovery assessment may not be made simply as a result of a development in the law which either makes an earlier assessment deficient or highlights a deficiency in an earlier assessment which was not otherwise appreciated. Similarly, it ensures that a change of HMRC practice cannot retrospectively justify a discovery assessment.

There are three conditions which need to be satisfied if a taxpayer is to rely on this defence:

the taxpayer must have made and delivered a tax return for the relevant tax year;

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