Justin's views about FTT judges confirmed?

The Upper Tribunal decision in Danapal gives some ammunition to the "FTT is biased" argument

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The Upper Tribunal in Danapal v Revenue and Customs [2023] UKUT 86 (TCC) has found very important errors of law in the FTT decsion that there was carelessness and dishonesty on behalf of Dr Danapal at the FTT.  I personally am surprised that Charles Hellier could make such mistakes and I would put them down to the lack of familiarity of some Magic Circle tax partners with such distasteful matters as the law on discovery assessments and penalties.  

Reflecting on it, there is undoubtedly some truth in a suggestion that some, not all, FTT judges can, on occasions, be the type of judge who, in the famous words of the great Lord Atkin in Liversidge v Anderson [1941] UKHL 1, "on a mere question of construction when face to face with claims involving the liberty of the subject show themselves more executive minded than the executive."  But I do not believe it is bias: just laziness and perhaps incompetence.


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By Justin Bryant
04th Apr 2023 09:22

I stopped reading the UT judgment half way down, as clearly the FTT decision was a farce from start to finish and there's no need for me to read the UT's conclusion here (I'm a bit busy today). (BTW, it's not just my view as I've said repeatedly here.)

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Replying to Justin Bryant:
By Justin Bryant
05th Apr 2023 15:51

Also, just to clarify (as this thread is now attracting attention), it's not just FTT judges. See some arguably worse decisions here from the CoA:

Obviously there are many other examples I could cite from the higher courts. This one sticks in my mind for some reason:


One of the most rubbish tax judgments ever in my view is this from the UT: https://assets.publishing.service.gov.uk/media/576e6a7ce5274a0da30000f9/...

This caused untold damage and bad tax case law elsewhere unfortunately as few people could be bothered to understand just how bad it was.

So I don't discriminate.

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By rmillaree
04th Apr 2023 09:31

Has that not always been the case and is one of the reasons why the FTT does not set a precedent. I am very much a lay person in these matters but i look back to the artic systems case many years ago and there was zero consensus there.

To me this goes right to the top with zero practical consideration for clear rules that make sense and work. It seems to me that the rules are written in such a way that the answer is often never clear - there is two sets of coin flips here at FTT - whether the answer is win or lose - and also whether the ftt tribunal will work out that correctly that a win is a win. S

Note i would split cases into two different kinds of cases.

1 - where individuals are going about then ordinary course of their life ref tax rules in a non avoidance way and the rules are poorly written so as to be unclear and its clear no silly boundaries have ben crossed.

2 - cases where individuals have chosen to push boundaries here and therefore get what they deserve when they lose. Eg ir35 peeps know its a risk and many avoid taking that risk (unlike Lineker and Holmes)

So perhaps for case 1 hmrc should have to win their case beyond a reasonable doubt in the mind of the ftt - then its up to the rulemakers to write proper clear rules. Or be obliged to withdraw if its not clear they are likely to win on that basis. There is no doubting that hmrc ignore whats fair when they try to punish the plebs.

I suspect having simpler clearer rules would benefit the entire system

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Replying to rmillaree:
By richard thomas
04th Apr 2023 09:42

Pro-HMRC decisions were commonplace by the General Commissioners, whose decisions also (thankfully) had no precedential value (as they were not published), but the setting up of the FTT was meant to stop that, among other things, by ensuring that a judge would be in control of hearings and that all important decisions would be published.

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Replying to rmillaree:
By mydoghasfleas
05th Apr 2023 14:03

It is not about rules but about law, which is generally well written. Where disputes arise it comes from opposing views rather than failings of the parliamentary draughtsman. Many of those views are supported by precedents in previous cases.

Beyond reasonable doubt applies to jury cases in criminal law. It is the jury who must be convinced not the judge.

If we were to go along your different kinds of cases route, who would decide which category they fell into? Surely that is prejudging the issue based on emotion. Is tax fair in the first place? To pay tax is an irregular verb generally conjugated as -
I (we) pay too much.
You pay the correct amount.
He, she, it (they) pay too little.

I think you are wrong addressing the issue of fairness with HMRC. A long time ago I was an Inspector of Taxes (really showing my age now). I was appointed by The Commissioners of Inland Revenue (pre 2005). The Commissioners were charged with the care and management of certain taxes. During training I was told to never get involved about the "rights or wrongs or fairness of the law": if the law said you tax blue eyes, you tax people with blue eyes. If the law was bad it was down to Parliament to change it.

The fact is that the average taxpayer does not have representation, the wealthier can afford some; the wealthiest can afford lots. The more Magic Circle lawyers and Big 4 accountants you have, the better your chances of success.

For the past 30 years many of the characters in those firms have been seconded to the Treasury and other government departments, so is it really a surprise what tax policy comes out?

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Replying to mydoghasfleas:
By rmillaree
05th Apr 2023 15:01

surely the law works with rules though you can do this and cant do that - how can you say its not about rules ?

what is legislation that says if either a - d below are met then you are ok - thats a rule in law is it not ?

classic cases are ebt and similar loan rules - these should have been clamped down on many years ago to make it watertight that peeps cant abuse the system.

The reality was everyone knew what was going on - its x many years since the rangers case came to light and even then it was a hard job to prove what was done.

In the menatime the well at heeled keep finding loopholes or arguments that alow them to darw cash without paying the tax that obviously should be paid.

I shudder at the sheet cheek and audacity of these peeps when i rear tribubnal cases - but so often its clear cut that the taxes that should have ben paid if proper rules existed has ben spent and there is zero want will or ability to turn back the clock. Sometimes hmrc lose on a technicality.

the fact that we have very basic cases like tim healey and the like furtehr evidence the law/rules and written very poorly and very rarely updated to improve them if grey areas exist the grey areas should be minimised.

Ask any accountant here whether the practicalities of the current system of r&d claims work - i think pretty much every acountant would say its a field day for shysters and chancers - while hmrc twiddle their thumbs. A simple upfront 5 minute mandatory q&a from a robustly challenging hmrc officer would probably have clobbered 75% of dodgy claims on the head.

If the learned professional the frequent tribunals cant see how much its broke thats as damning on them as it is on hmrc and the mp's.

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Replying to mydoghasfleas:
By SteveHa
02nd Oct 2023 15:41

mydoghasfleas wrote:

It is not about rules but about law, which is generally well written.

Really, because this had me scratching my head for ages earlier trying to work out what it meant.

"for the purposes of section 676AF, any period beginning no more than 3 years before the change in ownership occurs which is a period of 5 years in which that change occurs,"

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Nichola Ross Martin
By Nichola Ross Martin
05th Apr 2023 13:13

I agree that its something of a shocker of a decision. I guess that we all have bad days, but to get it all so wrong is unusual. I can't find the original FTT decision and it would be good to review that. Does anyone have a link?

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Replying to Nichola Ross Martin:
By richard thomas
05th Apr 2023 13:57

Very oddly, no. There is no mention as there often is in UT decisions of the neutral citation for the FTT decision appealed against. A search on Bailii and on the FTT decision database reveals nothing.

I can only assume that the FTT gave a summary decision and when the appellant sought to appeal gave a full decision, but did not submit it to the FTT to publish as it should have been. Alternatively it was a full decision but for some reason Charles marked on the relevant form (Trib 39) as not for publication, which is most unusual.

You can request a copy from the FTT.

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By Justin Bryant
05th May 2023 13:28

If you want proof, have a read of para 14 here.


Can you imagine a judge suggesting to a tax avoiding taxpayer ways to improve their pleadings etc. in order to win against HMRC on appeal (I think not)? Case closed I think.

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