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A number of cases have questioned the basic principles of making claims, the meaning of a claim being included in a return and the operation of HMRC's powers to enquire into claims (whether or not made as part of a return). The legislative aspects of making claims on a return or outside of a return are discussed in detail in A4.202.

These cases relate to whether HMRC had opened the enquiry using the correct legislative provision. The taxpayer's argument being that if the enquiry had been opened under the wrong provisions then the enquiry is invalid and HMRC would be out of time to open an enquiry under the correct provision.

The cases are fact-specific and apparently conflicting conclusions have been reached, leading to difficulties in clearly defining how the law actually operates. What does seem to be clear is that the courts are taking a purposive approach to the legislation, such that if loss relief is found not to be available in relation to a tax avoidance