Tag Archives: Supreme Court

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.

De Silva Appeal Dismissed by Supreme Court

This morning the Supreme Court delivered a decision that dismissed the De Silva appeal.

De Silva had appealed that HMRC had used an incorrect enquiry process to invalidate his claim and that his claim should stand.  The Supreme Court ruled that HMRC had, in his specific circumstances, acted lawfully.

The Supreme Court also ruled that the Cotter case gives no support to the taxpayers in this appeal,  De Silva and those stood behind De Silva.

The LTAG team will be reviewing the judgement with legal counsel in great detail to determine its application to the range of fact patterns LTAG claimants have.   We would expect to be in a position to provide guidance to LTAG members in two weeks.

Supreme Court Judgement on Littlewoods Case

On November 1st the Supreme Court delivered a final judgement on the long-running case between Littlewoods and HMRC.  That case was heard at the Supreme Court in mid-July.

The case related to whether or not over-payments of VAT made by Littlewoods to HMRC, and then refunded by HMRC, should attract simple or compound interest in addition to the capital refunded.  The difference to Littlewoods being nearly £1 billion.

The Littlewoods case referred to a number of prior UK  & EU cases that it felt showed precedent  supporting their case.

The Nov 1st 2017 Supreme Court judgement sided against Littlewoods.

It confirmed that the law in the UK has always been totally clear that interest paid and demanded by HMRC has always been simple interest and not compound interest.  It also confirmed that there are no EU laws that override UK laws in regards of payments made by or requested by sovereign government tax agencies.

At LTAG we see this as yet another high profile example of where the law courts do enforce the word of the law where it is abundantly clear what the law says.

We believe the LTAG case is similarly binary.  HMRC are, or are not in time to recover repayments made according to statutory limitations.