An appeals commissioner is the first port of call for a taxpayer who feels that a tax assessment raised by a tax inspector is unfair or unreasonable.

And legal sources said last night that Mr Haughey's successful use of the appeals mechanism will move the burden of proving the tax due by him onto the Revenue Commissioners should they bring a further appeal to the courts.

It is open to all taxpayers to have their case heard by an appeals commissioner under the self-assessment system. The procedure is a quasi-judicial one wherein the assessment is examined by an independent commissioner who decides whether it should stand, be dismissed or reduced.

The appeal by the taxpayer may be about the quantum of the assessment or whether any funds are owed to the Revenue or on a point of law. Appeals Commissioners are not lawyers. They are usually tax specialists - either accountants or former Revenue specialists. They regularly hear appeals throughout the State.

If a taxpayer's appeal to an Appeals Commissioner is rejected, the taxpayer can take his/her case through the legal system starting with the Circuit Court. A similar procedure is available to the tax inspector through the High Court if his/her assessment is rejected. But any appeal must be on based on a point of law and according to legal sources could take up to a year to be held.

Once a case moves into the Circuit Court the taxpayer can take the case through the full legal process up to the Supreme Court. An appeal can be made by a taxpayer to the Circuit Court on the size of the assessment or a point of law. Appeals from the Circuit Court to the High Court must be on a point of law while an appeal to the Supreme Court will lead to a re-examination of the whole case.

Following the revelations of the McCracken Tribunal a tax inspector raised an assessment on Mr Haughey which would have been sent to Mr Haughey or his advisers with an invitation to pay the tax as assessed.