Tax Tribunal - Disputes with HMRC, Record High

The number of tax disputes pending appeal at tribunal are at a record high for the last five years.

According to official figures, at the end of last year, there were almost 30,000 cases still waiting to be heard by the tax tribunal.

The Two Tier Tribunal system was introduced in 2009. When an individual or company wishes to launch an appeal into a decision made by HMRC over VAT or direct taxes, then this is heard at the First Tier Tribunal.

Should either party (including HMRC) wish to appeal the decision made by the First Tier Tribunal, they can seek permission to do so at the Upper Tribunal providing the leave for appeal has been refused by the First Tier Tribunal, and that the grounds for the appeal are on a point of law.

In the last year (to December 2014) the First Tier Tribunal saw appeals increase to 29,566, a rise by 8.5%, whereas, appeals to the Upper Tribunal had risen by 40% to 310.

Given the government’s continued clampdown on tax avoidance and tax evasion in the UK, the tribunal system has made preparations for an increased backlog by recruiting more tribunal judges.

Although the tribunal service has said that cases linked to HMRC Accelerated Payment Notices (APNs) had not yet started to come into the system, it is predicted that the number of tax disputes will increase as a result of APNs issued by HMRC over unpaid tax.

Accelerated Payment Notices are issued to individuals that HMRC suspects has avoided paying tax. They require the individuals to repay the amount of disputed tax up front.

An individual who has used a tax avoidance scheme or believes they may have underpaid tax, the time to make a voluntary disclosure to HMRC is now before you are in receipt of an APN.

To discuss your circumstances in complete confidence with our experienced tax investigations professionals you can call us on 0113 387 5670 or fill out an Enquiry Form and we will contact you straight away.