Member Since: 30th Jun 2017
30th Jan 2024
I know! Hilarious, isn't it. The usher losing the courtroom key aws another gem.
What was also interesting was Bean LJ's highly perceptive comment that "while there is no suggestion of time-wasting in the present case, the prospect of an unscrupulous advocate trying to run down the clock may not be entirely fanciful."
27th Jan 2024
A Taxpayer Bill of Rights/Taxpayers Rights Code/Taxpayer Advocate are all promising ideas, but only if properly designed and implemented, and in possession of sufficient "teeth" to ensure that HMRC actually complies.
Remember the original "Taxpayers' Charter"? The John Major one, which was launched to much PR trumpeting, but was little more than a bundle of aspirations which had no real effect on the behaviour of the Revenue and was, in due course, quietly buried in the backyard.
The current "HMRC Charter", introduced by FA2009, doesn't appear to be faring much better, if 15 years on we are still seeing such egregious instances of HMRC arrogance and overreach.
One line from that Charter is worth quoting: "We’ll assume you’re telling the truth, unless we’ve good reason to think you’re not". The number of appeals going to FTT where HMRC have miscategorised obvious simple errors as "deliberate behaviour" (in order to get bigger penalties and longer assessing windows) seem to suggest otherwise.
6th Jan 2023
Actually, Justin, you're misinterpreting what the judge meant (no shame there - I did too until I re-read it a couple of times!).
By "observed" he didn't mean "met" (i.e observed by the taxpayer); he meant "enforced with no wiggle-room" (i.e. observed by the FTT).
[If you think about it, that's the only thing it can mean. Prejudice, in a Martland context, can only arise from the actions of the tribunal, not from the prior actions or inactions of a party.]
In other words he was saying that, if the deadline had been treated as a *strict* deadline, with no latitude exercised by the tribunal to permit lateness, then HMRC would have a final and conclusive amount to collect, without the need to indulge in further litigation.
The theoretical prejudice would consist in using the tribunal's discretion to bring an appeal which would otherwise have died a natural death back to life.
23rd Dec 2022
That's the problem, isn't it: a lot of HMRC officers tend to act as if the ONLY tool they have in their box is the s29 assessment. I don't know whether that's down to the individual officers or to their training.
However, it wouldn't be half as much of a problem if it weren't for the department's bloody-minded attempts to throw good money after bad by refusing to back down once they have lost an argument.
Running to Parliament for a prospective law change when things didn't go your way in tribunal is fair enough; asking Parliament to backdate the law (the old "this has always been the true interpretation, honest guv" canard) is dubious to say the least; doing that AND trying to relitigate the lost appeal is, frankly, quite scummy. And - as you say - using the taxpayers' money to fund the whole saga of vindictive intransigence is the cherry on top of the cake.
Unsurprisingly, at each stage HMRC escalated their cost: at FTT they were represented by an in-house litigator; at UT by junior Counsel; then at CoA by a KC and a junior. (Wilkes' team acted pro bono throughout, so they haven't got rich from this.)
21st Oct 2022
It was indeed Goldsmith.
You raise an excellent point regarding "must" vs "may". It is almost as if HMRC would prefer the tribunals to have as little discretion as possible to disapprove of its actions, be they never so objectionable...
20th Oct 2022
Richard, you are of course quite right: it was largely the tyranny of word-count which led me to express the point I was trying to make far less well than I would in retrospect have liked.
I have no issue with the FTT considering jurisdiction sua sponte, as is right and proper. As a creature of statute, it does not enjoy the scope or competence of the higher Courts, and it is always satisfying to see a judgment where the tribunal cogently examines its own right (or otherwise) to intervene.
I also have no issue with HMRC putting it forward as a ground for strike-out in cases where an appellant is manifestly "pushing the envelope" (for example where judicial review would be the proper route).
What I do find troubling is HMRC arguing lack of jurisdiction in cases where the fact pattern is a clear appeal against an appealable decision. There have been a few cases recently(ish) where this has been done and the FTT has had to assert its rights. My fear (and I may well be over-paranoid here) is that it could turn into a tactic to "play the man rather than the ball".
I seem to recall there have been the odd occasions where you yourself have had to disabuse HMRC of the notion that you could not hear a case...
Your explanation re the greater importance of jurisdiction in excise duty and VAT is very welcome (I'm a direct taxes guy, so this is relatively unfamiliar territory to me).
The possibility that jurisdiction might be included alongside a "no reasonable prospect" ground as a sort of belt and braces approach is, I suppose, fair enough (although I remain less than wholly persuaded that the boundaries between the two are obscure).
In this case, though, there was not only a belt (abuse of process) and braces (no reasonable prospect) but also a piece of string tied around the waist (appeal contradicts all previous documentation including testimony on oath). There were so many ways in which any tribunal would have felt obliged to strike out the appeal that the inclusion of a jurisdiction challenge just seemed superfluous and - to my mind - poor optics.
All that apart (and apologies for the length), I will happily take the "good article" bit, especially when coming from you!
5th Oct 2022
Soooo - they could have defended, but chose not to?
In the words of the White Queen, "Why, sometimes I’ve believed as many as six impossible things before breakfast."
20th Nov 2021
Sorry for the delay, I've been AFK for a few weeks. The reason I used those words is because the situation is somewhat more complex.
There are two very different types of pension, both of which have been shoehorned into the same set of legislation:
1. Defined contribution (aka money purchase), where contributions are made (whether by the member or the employer) into a member's individual pension pot;
2. Defined benefit (aka final salary), where there usually are no actual contributions into the member's pension pot - and indeed no actual individual pension pot!
For the latter type of pension, an employer, via the pension scheme's actuary, accounts each year for changes in the anticipated overall level of pension (based upon each individual member's salary and the number of qualifying years of service). For example, someone's pension entitlement might accrue at a rate of 1/40 of salary every year: if his salary in year 1 was £100k, that would mean a pension of £2500 (1/40 x 100k). If his salary rises to £102k in year 2, his new pension entitlement is £5100 (2/40 x 102k). That means that over the course of the year, the pension to which he will be entitled has risen by £2600. Because the legislation imposes a 16x multiple (FA2004 s234) for the purposes of the Annual Allowance calculation, the member's pension rights (essentially a notional pension pot) has risen by £41,600.
For a final salary pension, the only possible definition for triggering an AA charge is this "increase in the value of the pension rights".
In a money purchase scheme, the corresponding increase in value of the member's rights is directly measured by the making of contributions. The value of your pension pot has directly and unambiguously increased by the amount of cash you have added.
In both cases, the term of art is "pension input", but that would make no sense to the average reader, so when writing about pensions I use a phrase which covers both scenarios.
Most people only think about money purchase arrangements (where planning is straightforward - simply pay a lower contribution), but the devil in this particular legislation is mainly being found in final salary schemes (especially the NHS Scheme, which I've covered in earlier articles).
High earners can find themselves liable to a tax charge for having exceeded the AA simply by virtue of a pay rise, or even by merely having accrued a further 1/40 of an unchanged final salary! If your personal AA is only £4000, your salary is going to be well north of £200k, so an extra 1/40 accrual is going to take you over the Allowance without so much as lifting a finger.
This is getting long. Hope it makes some sense.
2nd Sep 2021
Sorry, only just seen your comment.
jeremybarker has kindly linked you to the legislation which, as you say, is quite a big chunk. It's also written in oldspeak, so takes a fair bit of untangling.
For those who like more user-friendly guides, this link
is as user-friendly as it gets (it's a HoC briefing designed to enable MPs to understand this problem if it gets brought to them by constituents). Hope this helps - it contains footnotes linking through to the more detailed legislation.
13th Aug 2021
You appear to have ignored the word "entirely" in the subhead. Indeed, you then go on to criticise a misquotation which deliberately omits that word. Straw man, much?
The concept of entirety was the key issue in the case - HMRC treated the payment as monolithic, and the Tribunal rightly found that there were elements which had a different character than that of employment income and should therefore not be taxed as such.