LTAG Appeal Granted

We are very pleased to announce that, after an extraordinary delay, our application to appeal the High Court decision to the Court of Appeal has been granted.

It is worth observing that the Judge, Lord Justice David Richards, was unimpressed with HMRC’s initial skeleton argument and demanded that it be returned with a more fully-reasoned case. It is also interesting to note that, when ultimately granting permission to appeal, the Judge said that, having studied HMRC’s skeleton argument “I am not satisfied that my initial but provisional view that there was a real (as opposed to a fanciful) prospect of a successful appeal was wrong. The issues raised require oral argument.”

In addition, a very recent Supreme Court decision in a case called Derry has enabled us to strengthen the claim we are making at the Court of Appeal.

Derry also concerns loss claims made in a tax return and the interaction of tax administrative law. We won’t rehearse the detail here other than to say that the Derry ruling throws serious doubt on obiter dicta comments made by Lord Hodge in the case of De Silva, on HMRC’s powers to recover over-repayments of tax from carry-back claims, that being the case on which the High Court in Amrolia pinned its adverse judgment.

Derry may also have raised the prospect that where a claim for a loss arising in year 2 was made in the year 1 tax return, and was therefore part of the year 1 tax return, if HMRC failed to enquire into the year 1 return it cannot have a second bite of the cherry and enquire into the year 2 return.

As to when we will get into Court, this will depend upon the Court diary, assuming that the case will require maybe a day and a half. The present expectation is that this could be in the first quarter of 2020.

In addition, we are also aware of another case, Knibbs, where an appeal to the Court of Appeal has been heard, and judgement will soon be given, also on the grounds that De Silva was wrongly decided.

We regard the award of our appeal as very encouraging. Also, Derry & Knibbs undermine the De Silva judgement strengthening our own appeal.