Tax Controversy 2021

Last Updated May 20, 2021


Law and Practice


Old Square Tax Chambers is a specialist tax chambers in Lincoln’s Inn, London. It comprises 13 barristers, including three Queen’s Counsel, all focusing on UK tax matters. All UK taxes are covered, but a significant amount of chambers' work involves offshore matters and clients based outside the UK but with UK interests. Chambers’ clients include a mix of HNWIs (most frequently in relation to capital gains tax, income tax and inheritance tax, including UK and offshore trusts) and corporate clients (generally on corporation tax and VAT matters). Property taxes, including stamp duty land tax, are a significant part of chambers’ work. Chambers covers both tax advisory work and tax litigation. Advisory work involves one-off transactions (for example, M&A and corporate structuring) and more general tax structuring. Members have appeared in litigation at all levels of the UK court system, including the Supreme Court, and before the European Court of Justice. Recent cases have involved VAT, income tax, national insurance contributions, and HMRC enquiry and investigation powers.

Tax controversies usually arise following an inspection or enquiry by the UK tax authority, HMRC. Enquiries are a specific type of investigation that take place where a tax return has been submitted to the authorities, for corporation tax or income tax, for example. HMRC can open an enquiry within the year following the submission of the return. Outside that, HMRC can open investigations into the tax position of any taxpayer. This can happen at any time. Sometimes, investigations arise out of a regular inspection HMRC has made of a business; sometimes, they arise out of information that HMRC has either noticed or received from a third party.

Tax controversies arise in relation to all UK taxes, and indeed foreign taxes where the UK is bound by mutual assistance and/or recovery obligations. The most litigated tax tends to be value added tax. This is probably because it is a turnover tax the amount of which depends on the classification of what is supplied. There are inevitably grey areas between different categories of supply. In addition, despite Brexit, VAT remains a tax based on European law that is given effect through national legislation (though this will diminish in importance over time). It can be difficult to reconcile the two different sources at times. The amounts involved in tax litigation, generally, are inevitably varied, and it is not apparent that there is any particular tendency in HMRC to pursue any particular range of sums. Ultimately, this is because HMRC’s obligation is to pursue all tax that is properly due, regardless of the amount involved. There are some concessions that mean minor amounts of tax will not be collected, but disputes are litigated for amounts ranging from a few hundred pounds to billions of pounds.

The possibility of tax controversy can be reduced by a taxpayer in a number of ways. The first is by not taking an aggressive approach to tax planning. In general, HMRC will investigate, more often and in more depth, taxpayers who have a history of engaging in aggressive tax avoidance, whether they be individuals or corporate entities. Second, pro-active engagement with HMRC in all cases where there is real doubt about the correct tax treatment reduces the potential for disputes generally, but specifically the potential for the imposition of penalties and the charging of interest. Third, the use of appropriate external professionals (whether accountants, solicitors or barristers/advocates) can help reduce the potential for penalties where advice is taken, and it is reasonable to rely on it.

The OECD's Base Erosion and Profit Shifting (BEPS) Recommendations and the EU’s anti-tax avoidance measures, double tax treaty amendments and changes to domestic legislation have not had any significant effect in reducing tax controversies. While any significant increase is also yet to be observed, any new legislation tends to bring with it a likelihood of disputes, particularly where it is complex legislation such as that in the UK that reflects or implements the BEPS project. Of course, EU measures are less relevant in the UK than previously, and will continue to decrease in relevance over the next few years. But Brexit will result in significant amounts of tax legislation, so there is significant potential for tax controversy in the coming years.

Additional tax assessments in principle give rise to an obligation to pay the amount of tax assessed immediately. However, in direct tax cases (mainly income tax, capital gains tax and corporation tax), where an appeal is made against an assessment (in the first instance to HMRC, and thereafter to the First-tier Tax Tribunal), the taxpayer can apply for payment to be postponed until the appeal is finally determined.

Postponement will be granted where there are reasonable grounds for believing that the tax assessed, or any specified part of it, is not due. In general, the bar for passing the test is set fairly low by both HMRC and the Tribunal. However, in cases involving fraud or aggressive tax avoidance, it is less likely that postponement will be granted.

In indirect tax cases (the principal one being value added tax), the taxpayer can also apply for payment of the tax in the assessment to be postponed. However, a different test is applied. This is whether payment of the tax is likely to cause hardship to the taxpayer. The strength of the appeal is irrelevant. Taxpayers, in particular corporate entities, can be required to provide significant information (such as recent statutory accounts, management accounts, property registers, details of debt facilities, and so on) in order to obtain postponement on the ground of hardship. If HMRC refuse postponement, the application may be renewed before the First-tier Tribunal.

If the taxpayer loses the appeal to the First-tier Tribunal, the tax becomes due, even if the taxpayer appeals further. However, there is a further possibility of postponement at that stage, namely if payment might reasonably be expected to cause the taxpayer to suffer financial extremity. Again, the application is made to HMRC in the first instance and, if refused, can be renewed before the First-tier or Upper Tribunal.

However, in cases involving tax avoidance, a taxpayer can in certain circumstances be required to pay the tax immediately, and indeed as a condition of being able to make an appeal against the additional assessment.

The reasons why HMRC choose to initiate tax audits are not published. However, it is understood that a wide variety of factors are taken into account. First, a number of random audits are initiated into tax returns submitted each year. These can be of limited scope, but, where HMRC find matters that they do not consider to be satisfactory, can be widened to a broader range of issues. Second, large businesses and high net worth individuals can be expected to have a designated "relationship manager" within HMRC who meets at least annually with the business/individual and/or their advisers to discuss a variety of matters believed by HMRC to be relevant to the taxpayer’s tax affairs. Apart from that, a history of aggressive tax avoidance (or tax fraud) will be likely to cause HMRC to initiate enquiries into a taxpayer’s returns, and to cause any such enquires to be more detailed than they might otherwise be.

HMRC also focuses on particular industries, trades or professions from time to time. These more sector-related strategies often focus on individual taxpayers rather than corporate entities. The recent creation of a new digital services tax makes it likely that significant focus will be on that sector in the next few years, as HMRC and relevant taxpayers try to get to grips with the new legislation in what is inevitably a complex environment.

Time limits for initiating and completing a tax audit depend on whether the basis for the audit is a return that has been provided, or information that has come to HMRC outside a tax return for which an enquiry can still be opened. It also depends on the type of tax involved. In relation to direct taxes, returns are required to be lodged annually. A tax audit can be initiated within one year of the lodging of the return (a slightly longer period is allowed where the return is submitted late). Thereafter, there is no specific time limit on how long the audit (enquiry) can last. However, if a taxpayer considers that HMRC are taking an unreasonably long time to conclude the enquiry, the taxpayer can apply to the First-tier Tribunal for a "closure notice", that is, an order that HMRC conclude the enquiry within a specified period of time.

In addition to enquiries, HMRC can make additional tax assessments without initiating an enquiry. For these, the time limits (for direct taxes) are generally four years after the end of the tax year to which the assessment relates, or, if the taxpayer has been guilty of careless or deliberate conduct, then six years or twenty years, respectively. In addition, an assessment cannot be made unless the taxpayer was guilty of careless or deliberate behaviour, or HMRC did not have in its possession all the information it needed to make the assessment before the expiry of the time limit for opening an enquiry into the taxpayer’s tax return for the relevant tax year.

In relation to indirect taxes (VAT in particular), there is no time limit for initiating an audit. However, there are time limits on when HMRC can make an assessment for additional tax that has not been paid. Generally, the period is four years after the end of the accounting period (normally a quarterly period) in which the tax arose, subject to a shorter period (normally one year) after the date on which HMRC had in its possession all the information they required to be able to make the assessment in question. Again, in cases of careless or deliberate behaviour, the four-year time limit is extended to six years and twenty years respectively. General limitation/prescription rules do not apply to the initiation of tax audits or the making of assessments, except in relation to social security contributions. In relation to these, there is a general limitation period of six years from when the contributions were due to be paid.

Generally, tax audits are carried out via a mix of meetings and correspondence. Where meetings are held, they are almost always held at the taxpayer’s premises (sometimes the premises of the taxpayer’s professional advisers). Where information is sought by HMRC, it is normally first requested by correspondence. In cases where a taxpayer is slow or reluctant to provide information, HMRC can obtain an order from the First-tier Tax Tribunal requiring the taxpayer (or third parties) to provide information reasonably required to enable HMRC to check the taxpayer’s tax affairs. This is a wide power. Where HMRC have grounds for suspecting that documents may be destroyed or concealed if notice of their information requirement is given to the taxpayer in advance, HMRC can obtain an order from the First-tier Tax Tribunal allowing them to enter any premises and remove documents or other items found there that are relevant to checking the taxpayer’s tax position. Correspondence is normally electronic, albeit that HMRC will not correspond by email without the taxpayer’s express agreement.

In general, the key areas and matters for tax auditors’ special attention depend primarily on the nature of the taxpayer’s affairs and business. However, HMRC are particularly interested in any offshore structures (shown, for example, by the fact that penalties for inaccuracies in tax returns and other tax compliance failures related to such structures are higher than for failures involving purely UK situations) and tax avoidance arrangements (there has been a proliferation of new legislation over the past decade seeking to create disincentives to tax avoidance, including penalties on advisers who advise in relation to arrangements that are found to be particularly egregious). Apart from that, the substantive issues that HMRC focus on are driven by the value of the issue in the context of the particular taxpayer.

So far as the taxpayer is concerned, HMRC are increasingly being challenged as to the procedure they follow in tax audits, whether as regards time limits, or the nature and scope of the enquiry they pursue, or other procedural issues. There is also an increasing number of challenges concerning attempts by HMRC to recover documentary evidence from taxpayers, albeit that generally the means of this challenge is judicial review rather than appeal, so that the basis of the challenge (broadly speaking) has to be some sort of unreasonable behaviour on the part of HMRC. See the UK Trends & Developments chapter in this guide for further details.

There is undoubtedly growing co-operation between HMRC and foreign tax authorities. Whether this has led to an increase in the number of tax audits is not clear, given that HMRC has always carried out a significant number of audits in relation to individuals and corporates who have cross-border interests. Certainly, however, HMRC is frequently requested, by foreign tax authorities, to obtain information for audits those foreign authorities are undertaking, and HMRC has extensive powers to obtain such information where the foreign authority is within the European Union or is in a territory with which the UK has mutual assistance arrangements. (Brexit is unlikely to make a material difference to this as the UK has mutual assistance arrangements with most other EU member states under double tax treaties, and these do not depend on EU law for their validity or implementation.)

The main strategic points for consideration during a tax audit are first, the strength of the taxpayer’s position, second, any timing issues that arise (for example where HMRC are out of time to make assessments for particular tax years), and third, the degree of co-operation the taxpayer wishes to extend towards HMRC.

Strength of Position

The strength of a taxpayer’s case is the most important factor in deciding on the approach a taxpayer should take to disputes that arise in a tax audit. Strength of position can often best be analysed by involving a barrister who specialises in tax. The UK Bar is an independent referral Bar, and so its members can be called upon for specific cases, or even specific issues within cases, to give independent advice to a taxpayer who is already advised by accountants or solicitors. Apart from specialist knowledge, the expertise barristers bring is experience of the approach that tribunals and courts take to deciding tax issues. This is important because HMRC also draw on extensive specialist knowledge and extensive experience of tax litigation, and so always have in mind what a court of tribunal will think about whatever position the taxpayer is adopting. In addition, if a dispute goes to a tribunal or court, it is often a tax barrister who represents the taxpayer. Thus, it is best to involve the barrister as early as possible, so that the best basis for any court proceedings can be built up from the start. For example, correspondence between the taxpayer and HMRC during the course of the audit giving rise to the dispute is often used as evidence, and it is therefore important to ensure that the correspondence sets out the taxpayer’s best position, one that will be viewed sympathetically by a court or tribunal. This is something that barristers are experts at advising on.

Timing Issues

Time limits in tax audit and assessment procedure are complex. Each tax has its own set of time limits. It is important to be able to identify the correct time limit for the particular tax and the particular type of procedure. Albeit it is rare for HMRC to miss a time limit, this sometimes happens; and in indirect taxes in particular, where one issue can arise simply on an ongoing basis (for example, product classification where identical goods are sold by a manufacturer over a lengthy period of time), the extent of any assessment is restricted by reference to a time limit within the end of a tax accounting period, even though the issue may have arisen significantly longer ago. If HMRC miss a time limit, there is generally no possibility for them to apply to a court or tribunal for an extension of it.

Degree of Co-operation

Where a tax audit ends with a requirement on the taxpayer to pay additional tax, HMRC have extensive powers to impose penalties, whether the underpayment has arisen through an inaccuracy in a return, a failure to submit a return, or any other reason. Penalties are often tax-geared, that is, set at a percentage of the additional tax required to be paid. The percentage can be reduced by HMRC where the taxpayer has co-operated with the audit, for example by making a voluntary disclosure on coming across the issue, or simply by providing documents promptly when requested by HMRC and putting forward the taxpayer’s justification of its own position in detail. Accordingly, it is important to decide how co-operative the taxpayer should be, and there are significant benefits in adopting a co-operative approach to tax audits.

Where HMRC issues an assessment, it is normally open for a taxpayer to require HMRC to carry out an internal review of the assessment. The review is not mandatory: a taxpayer can instead choose to appeal directly to the First-tier Tax Tribunal (part of the court system). The scope of the review tends to be limited, in particular where HMRC has a published position as regards what it believes the law to be on the point in dispute, but in a significant number of instances a review results in a reduction, if not of the tax in issue then of any penalty that has been imposed. On the other hand, the review can result in an increase in the tax sought to be assessed by HMRC (though this is rare).

The request for an internal review has to be lodged by the taxpayer with HMRC (with the officer who made the decision to be reviewed) normally within 30 days of the decision to be reviewed. Thereafter, HMRC have 45 days to conclude the review, unless the taxpayer agrees that HMRC may take longer. It frequently occurs that HMRC request a longer period; inevitably, the taxpayer agrees, because if the time limit expires without HMRC having given a decision on the review, the review is deemed to have upheld the original decision.

The procedure for review is that the officer who made the decision being reviewed passes the case to another HMRC officer in one of the review teams who has not previously had any involvement in the dispute. That officer then contacts the taxpayer and sets a time limit (normally short) for the taxpayer to provide any further information the taxpayer wants to be taken into account. While the taxpayer is free to submit additional documents, or set out further explanations of the analysis of the position, there is no correspondence between the taxpayer and the officer (in the sense that the officer will not engage in discussion) but, on the basis of any additional evidence/analysis put forward, will make a decision on the review. The outcome of the review can be to uphold the original decision in its entirety, cancel it in its entirety, or vary it or reduce any amounts assessed (including penalties). It should be noted that if the decision is cancelled, this does not necessarily prevent HMRC re-opening the issue; but one often finds that, even if in theory the review decision permits HMRC to assess the tax again, it is too late for HMRC to do so.

As mentioned, the deadline for HMRC to give its decision on a review is 45 days after the request for a review is lodged. However, this can be extended by agreement with the taxpayer, and the reality is, particularly in cases of high value or involving any complexity, that the period is extended by agreement. This is not least because if there is no extension, and HMRC do not conclude the review within 45 days, the outcome is that the original decision is deemed to have been upheld.

Judicial tax litigation is initiated either by a notice of appeal to the Tax Chamber of the First-tier Tribunal, or by an originating writ to the High Court of Justice. The former is appropriate for most forms of dispute (broadly, anything to do with substantive tax issues). The latter is, broadly, appropriate for procedural complaints that a taxpayer has against HMRC, based on more general principles of public law.

A notice of appeal to the First-tier Tribunal is completed electronically (it remains possible to submit paper appeals, but this is becoming rarer). The form is relatively short. What is required is some information about the tax in dispute and a relatively short statement of the grounds of appeal. There must be lodged with the notice of appeal, a copy of the decision being appealed against, together with any internal review decision given by HMRC.

A writ in the High Court is a much more complex document. The form requires a detailed outline of the facts and issues to be set out, and is accompanied by a Statement of Grounds, a Statement of Facts, and at least one witness statement vouching that the facts averred are true. It is also necessary to engage in pre-litigation correspondence, and the time limit is relatively strict (a maximum of three months, or any shorter period within which it would have been reasonable to raise the proceedings).

First-tier Tax Tribunal

Where the appeal is to the First-tier Tribunal, on receipt of the notice of appeal the Tribunal allocates the appeal to one of four categories (default, paper, standard or complex). This is important because it determines further procedure, and also the costs regime that applies. In complex category cases, the normal approach is that the party that loses the appeal pays the costs of the winning party, unless the taxpayer opts out of this rule within 28 days of the Tribunal’s case category notification. In the other three categories, the normal position is that each party bears its own costs, unless the other has acted unreasonably in bringing, maintaining or defending the appeal.

In basic and default cases, the Tribunal then fixes a hearing (parties can request a different date if the dates given are not suitable) and a time limit for lodging any documentary evidence or witness statements, authorities, and explanation of the case. These cases are often decided by the Tribunal on the papers only (that is to say, without an actual hearing).

In standard and complex cases, the procedure is more complicated. HMRC are required to serve a Statement of Case. This is HMRC’s outline of the facts and analysis of the dispute. The normal time limit for this is 60 days after the Tribunal’s notice of category allocation. Thereafter, the parties have 42 days to exchange a list of the documentary evidence on which each of them intends to rely (in practice, the Tribunal extends this time limit once HMRC have submitted their Statement of Case). The Tribunal also fixes a date by which the parties have to provide a list of witnesses and dates on which the parties are unavailable to conduct the hearing within a three-month window that the Tribunal has fixed. In advance of the hearing, the parties must exchange witness statements (including expert reports if required) and, shortly before the hearing, skeleton arguments. The hearing is then conducted in person (while coronavirus restrictions are in place, most hearings have been conducted via videoconference). There can be one, two or three judges depending on the value, novelty and complexity of the case. Witnesses can be cross-examined. Once the evidence has been heard, each party makes submissions at the hearing on the whole of the dispute. Normally, the Tribunal does not give an immediate decision. Most decisions are given in writing, normally around two to three months after the hearing.

High Court Judicial Review

In judicial review proceedings in the High Court, the procedure following the service of the initial writ is generally more summary in nature. After an exchange of skeleton arguments, a hearing is held in person before a single judge of the High Court. It is rare for there to be any dispute as to the facts. Therefore, the first hearing is on assumed facts; and it is only if the judge then considers that there is a factual dispute that requires evidence that there will be a further, evidential hearing. Normally, however, there is no need for an evidential hearing and the judge will make the decision on the case after the first hearing.

First-tier Tax Tribunal

In appeals to the First-tier Tribunal, evidence is crucial. The approach of the Tribunal is, in short, to take no fact into account unless it is (i) proved by adequate evidence, (ii) agreed between the parties, or (iii) within judicial knowledge. The last category is rarely relied upon, and of course the Tribunal judge never has any specific knowledge of the facts of the particular case. In addition, while HMRC are generally willing to agree facts with a taxpayer, HMRC will do so only for facts that are adequately proved by evidence. Again, this is because HMRC more or less never has any actual knowledge of the specific facts of the case. Thus, all the evidence has to come from the taxpayer (HMRC have powers to obtain evidence from third parties, but so far as the taxpayer wishes to rely on facts, the taxpayer bears the burden of providing evidence to vouch those facts).

Accordingly, documentary and witness evidence provided by the taxpayer is crucial in litigation before the First-tier Tribunal. Documentary evidence must be provided at an early stage (in theory, around four months after the notice of appeal is lodged with the Tribunal). Witness evidence is given primarily by witness statement. Witness statements, including any expert witness reports, must also be lodged significantly in advance of the hearing of the appeal (though just how far in advance is a matter for the Tribunal to direct in each case; normally, it is at least two or three months in advance). At the hearing itself, a party may take some additional evidence from its own witnesses, and may cross-examine the witnesses for the other party. However, tax litigation tends not to involve a lot of cross-examination, as most matters are substantiated by documentary evidence.

High Court Judicial Review

Where proceedings are judicial review proceedings in the High Court, a witness statement and all relevant documentary evidence must be lodged at the very beginning of the proceedings, when the initial writ is served. Normally, however, there is no evidential hearing. This is because the nature of judicial review means that, in general, the facts are agreed and what is in dispute is how HMRC has made whichever procedural decision is being reviewed.

In civil tax proceedings, the burden of proof is generally on the taxpayer. However, where HMRC have made an assessment based on a taxpayer’s careless or deliberate conduct, the burden of proving the taxpayer’s conduct to have been careless or deliberate is on HMRC. In addition, where the issue is penalties, it is for HMRC to prove the facts justifying the imposition of the penalty, and for the taxpayer to prove any reasons relied upon in mitigation. The standard of proof is the balance of probabilities.

In criminal proceedings, the burden of proof is on the prosecuting authority. The standard of proof is beyond reasonable doubt.

At a number of stages in tax litigation, strategic questions arise. In particular, strategic issues arise when deciding whether to apply for internal review or appeal directly to the First-tier Tribunal; what grounds of appeal to put forward, and how much detail to go into when setting them out; whether to apply for the Tribunal to change the category allocation it has made, or to opt out of the costs regime where the appeal has been categorised as complex; and to consider settlement from time to time.

The timing of producing documentary evidence and witness statements is generally fixed. Nothing is to be gained by not complying with time limits, and indeed a failure to comply brings with it the risk of not being allowed to rely on the evidence at all, or at least being responsible for any costs incurred by the other party because of the delay. There is some flexibility as regards the timing of providing expert reports, but the need for them is generally dictated by the nature of the factual issues between the parties: are there any disputed facts that involve opinion evidence on matters about which there is some body of specialist knowledge? If so, then opinion evidence is required, and it is generally best to raise this as early in the proceedings as possible. Any delay risks not being allowed to rely on such evidence, or at least bearing the costs incurred by the other party in consequence of the delay.

So far as settlement is concerned, HMRC has a published Litigation and Settlement Strategy. This does not allow HMRC a great deal of manoeuvre in agreeing to compromise cases. However, the published document supports the need for HMRC, as a public body, to be transparent in its dealings with the public.

There is little, if any, theoretical limit to the type of materials that can be put forward in appeal proceedings by way of previous case-law, official publications and published commentary. The question is always as to their relevance to the issue and the weight to be attached to them.

Within the UK, there is a strict hierarchy of judicial precedent. The case-law of the European Court of Justice is no longer binding: UK courts must simply have regard to it where relevant. Case-law of other international tribunals, including the European Court of Human Rights, can likewise be taken into account but is not binding. As for domestic courts, decisions of the Supreme Court (formerly the House of Lords) are binding on all other courts lower in the hierarchy. The same applies to decisions of the Court of Appeal (and its equivalents in Scotland and Northern Ireland). Decisions of the Tax and Chancery Chamber of the Upper Tribunal are binding on the First-tier Tribunal. Decisions by the First-tier Tribunal are persuasive, but do not bind any future tribunal or court (including the First-tier Tribunal itself). Double taxation treaties, BEPS documents, OECD guidelines and commentaries, and indeed any textbook, academic commentary or journal can all be put forward, but none is binding on any tribunal or court.

The Tax Chamber of the First-tier Tribunal, which is the only forum in which evidence is normally heard, is the first-instance tribunal. In cases relating to direct taxes, access to this tribunal is unlimited: for example, the requirement to have paid the tax in issue before the Tribunal can hear the dispute is waived if the taxpayer has reasonable grounds for appealing (this does not always apply in cases involving artificial tax avoidance). In indirect tax cases, however, the normal position is that the tax must be paid before the Tribunal can entertain an appeal. There is an exception if the requirement to pay would cause the taxpayer "hardship" (Please refer to 1.5 Additional Tax Assessments for further discussion).

A decision by the First-tier Tribunal can be appealed, but only on a point of law, to the Tax and Chancery Chamber of the Upper Tribunal. In the Upper Tribunal, the costs regime is different from the First-tier Tribunal in that costs are generally awarded in favour of the successful party. A decision can be appealed from the Upper Tribunal to the Court of Appeal (or Scottish or Northern Irish equivalent), but again, only on a point of law. There is a further requirement that the appeal must pass the "second appeals test", which is that it must raise a critical point of general importance, or there must be some other compelling reason (for example serious procedural failure in the Upper Tribunal) for it to be heard by the Court of Appeal. From the Court of Appeal there is one final appeal possible, to the Supreme Court. It is no longer possible to refer questions of EU law to the European Court of Justice.

Any tax appeal can be submitted only once. Once the appeal has been finally determined by the tribunal or court, the issue may not be raised again. This is generally in accordance with the principle of res judicata, extended by statute in tax matters so that (for example) an ongoing issue of product classification in value added tax cannot be appealed a second time just because a new accounting period has ended. What would be required in that example is some material change to the product in question.

The different stages in tax appeal procedures are:

  • correspondence with HMRC, leading to a decision by HMRC;
  • (optional) internal review by HMRC;
  • appeal to the First-tier Tax Tribunal, covering both legal and factual matters, and including an evidential hearing;
  • appeal to the Upper Tribunal, only on a point of law;
  • appeal to the Court of Appeal, only on a point of law, and only where the appeal raises some general point of public importance, or there is some other compelling reason why a further appeal should be heard; and
  • appeal to the Supreme Court, only on a point of a law and subject to the same "second appeals test".

All courts and tribunals are independent of HMRC. Appointment is via the Judicial Appointments Board, a public body that is independent of HMRC and is responsible for judicial appointments to more or less every UK court and tribunal.

The First-tier Tribunal is composed of a mixture of lawyers, accountants and tax advisers. Some judges are full-time; others are part-time and so carry on an independent practice as well as acting as judges (there are no part-time judges who are also employed by HMRC). Appeals are heard by one, two or three judges. The criteria for how many judges sit are not entirely clear, but the number broadly depends on the amount at stake, the complexity of the case, and the importance of the case.

The Upper Tribunal is also composed of a mix of lawyers, accountants and tax advisers, but High Court judges are also members of the Upper Tribunal and frequently sit in it. Appeals are heard by one or two judges (almost never three) and this again depends on value, complexity and importance.

The Court of Appeal comprises normally three judges. These are individuals who have almost always been barristers in private practice (sometimes solicitors or academic lawyers), and who have first been appointed as High Court (first instance) judges before being appointed, normally after a number of years, to the appellate court.

The Supreme Court sits normally with five, but sometimes with seven, nine or even eleven judges for the most important cases. Supreme Court judges are almost always appointed from the Court of Appeal (or Scottish or Northern Irish equivalents).

HMRC offer a mediation service for tax disputes. It is available for most substantive tax disputes, but generally not in relation to tax avoidance issues or penalties. The mediator is an employee of HMRC who has, however, no involvement in the case, and who is employed only as a mediator. Mediation is normally held at an HMRC office. The taxpayer can attend in person, and may be accompanied by advisers. Mediation tends to have most chance of success where the issue is not a binary one. For example, where the issue is one of valuation, so that there is no "correct" answer, mediation can be worthwhile. However, where the issue is, for example, whether a particular receipt is capital or revenue, or whether an individual is an employee or self-employed, mediation is less likely to lead to settlement of the dispute.

There is no formal tax arbitration mechanism in the UK. While parties are free to agree to settle a dispute by arbitration, this rarely happens.

There is likewise no other specific ADR mechanism (such as expert determination) provided for tax disputes.

Where mediation takes place, the officer of HMRC who has made the decision in question will be in attendance. If settlement occurs, it does so through discussion in the course of the mediation (which can last anywhere from an hour or two to two or three days, depending on the complexity of the issues). The procedure at a mediation is flexible, but generally consists in each party having an opportunity to put its case forward, and then having a private discussion with the mediator as regards the potential for reaching agreement, before an open discussion between both parties to which the mediator also contributes. If agreement is reached, it is put into writing in a document that complies with statutory requirements, and is given statutory force. The document can be drawn up and signed at a later date, though it is desirable if at least a draft is agreed in the course of the mediation.

If, by means of mediation, an agreement is reached to reduce the tax due, then any interest and penalties (to the extent that they depend on the amount of tax due) are automatically reduced. For example, most penalties are a percentage of the tax that was not paid on time; if the amount of tax is reduced, the penalty is inevitably reduced. On the other hand, if a penalty has been imposed for lateness in submitting a return, or otherwise does not depend on the amount of the tax in question, then whether it is reduced will depend on factors other than the reduction in tax agreed by means of the mediation.

Binding advance information (mainly in relation to transfer pricing, VAT and customs duties) and requests for rulings (mainly in relation to direct taxes) are helpful in ensuring certainty and avoiding disputes. Provided that a taxpayer discloses all material facts to HMRC, HMRC cannot withdraw the binding advance information, or a ruling it has given, so as to impose tax, at least retrospectively. HMRC can, however, change its policy so that, once the change is notified, the binding information can no longer be relied on. (This is generally not relevant for rulings, as they normally relate to specific, one-off transactions.)

As mentioned in 6.1 Mechanisms for Tax-Related ADR in this Jurisdiction, most tax issues can be the subject of mediation. But HMRC will generally not agree to mediate tax avoidance issues or penalties, or where there is any question of fraud.

Mediation sits alongside the tribunal/court appeal system. Thus, while there is no time limit directly applicable to mediation, time limits relating to appeals to the tribunal must be complied with unless the tribunal directs that its proceedings are to be stayed pending mediation.

Because mediation leads to an agreed outcome only, there is no appeal possible: any appeal must sit alongside the mediation process so that, if agreement is not reached, the decision is ultimately made by the tribunal/court system in the normal way.

Mediators are employees of HMRC, appointed by rota internally (a taxpayer can object to a particular mediator on justified grounds).

Issues of precedence, strict application of law, and reliance on equity do not limit the scope for what may be agreed between the parties. However, each party inevitably bases its own position on previous tribunal/court decisions and similar factors, so that those decisions form the context within which the parties approach the mediation.

Mediation can be used to resolve cases concerning transfer pricing.

The fact that sufficient tax has not been paid is not in itself enough to justify either civil or criminal penalties. Generally, where an assessment of additional tax is made, civil penalties may be imposed where the taxpayer has been careless or deliberate in relation to the failure. These penalties are initiated by the tax authority, by first giving notice of the possibility of penalties (together with information about human rights) in the course of an enquiry/investigation. Because the amount of the penalties generally depends on the amount of additional tax due, penalties are imposed at the same time as, or subsequent to, the additional tax assessment.

It is unusual for HMRC to seek criminal penalties for the underpayment of tax. This is because HMRC’s primary function is to collect tax due, whereas criminal prosecution does not generally lead to recovery of any additional amount of tax. However, criminal prosecution is gradually increasing, as HMRC see it as becoming more important for them to deter taxpayers from committing tax fraud, and as the courts have, over the past 20 years, been given more extensive powers to recover the proceeds of crime from individuals convicted of criminal offences. Thus, there is a possibility that unpaid tax can be recovered through criminal proceedings. However, HMRC have a variety of effective measures open to them to recover tax by civil proceedings, including ultimately bankruptcy of the individual or liquidation of corporate entities.

Where HMRC raises both civil and criminal proceedings, in general the civil proceedings are suspended while the criminal proceedings continue. However, this is at the discretion of the criminal and civil court/tribunal. Criminal liability generally does not depend on the amount of tax evaded, although that is always relevant to sentencing.

HMRC normally initiates an administrative infringement process whenever the officer who makes the additional tax assessment believes there to have been careless or deliberate conduct by the taxpayer. Criminal processes are initiated where there is a belief that tax has been fraudulently evaded. An administrative process can give rise to criminal proceedings, but criminal proceedings will rarely mean that the administrative process is stopped. It is not common, however, for an administrative process to give rise to criminal proceedings.

An administrative infringement process involves no more than (i) a warning that HMRC is considering imposing penalties; and then, (ii) potentially following correspondence, the imposition of penalties. Penalties can be appealed to the First-tier Tribunal.

Criminal proceedings are significantly more complicated. They follow the normal course of criminal trials, including, in higher value cases, trial by jury. They are heard by a different set of courts, namely the normal criminal courts.

Upfront payment of the additional tax assessment is not generally relevant to the amount of civil penalties. However, it can be relied on as mitigation when requesting a reduction of criminal penalties (though it will not necessarily make any significant difference).

Payment of the tax, interest and penalties generally does not stop criminal prosecution. This is because if criminal proceedings are taken, the reason for doing so is not to obtain payment of the tax but to punish the accused and deter others from committing tax fraud.

An appeal against a criminal tax decision lies to the Court of Appeal and, thereafter, to the Supreme Court.

As a rule, transactions that are challenged by the general anti-abuse rule (GAAR), specific anti-abuse rules (SAARs) or targeted anti-abuse rules (TAARs), transfer pricing rules and other anti-avoidance rules generally give rise to administrative/civil proceedings. They follow the general procedure for assessments and appeals against assessments, set out in 4. Judicial Litigation: First Instance and 5. Judicial Litigation: Appeals.

Where an issue arises under a double tax treaty, the more usual way to have it resolved is by appeal to the First-tier Tribunal. Neither the OECD's Multilateral Instrument (MLI) nor the EU Tax Disputes Directive have had a significant effect in the UK.

The UK GAAR applies to cross-border situations, in particular involving abuse of double tax treaty provisions so as to avoid UK tax. There is no dispute that these scenarios are within the scope of the GAAR; however, there is no case-law on this at this stage. However, case-law is clear that other double taxation treaty issues can be litigated in the domestic tribunals when relevant to a tax assessment. The UK approach to tax avoidance makes it unlikely that there will be a significant difference caused by the principal purpose test introduced by the MLI.

There are few transfer pricing disputes that have been litigated. Normally, any litigation is in the domestic tribunal system.

Advance pricing agreements are very common in the UK as a means of minimising transfer pricing disputes. The procedure is normally a matter of extensive negotiation between HMRC and the taxpayer.

There is no clear picture as regards what type of cross-border situations generate most litigation. If anything, perhaps the most litigated scenarios are offshore situations, in particular those involving tax planning/trusts, concerning individuals.

The UK has opted to apply Part VI to its covered tax agreements.

There is generally no specific limit on the type of matters that can be submitted to arbitration by a UK taxpayer.

The UK has adopted the "final offer" arbitration process as the default process. It will apply except where other contracting states have adopted the independent opinion procedure.

Following Brexit, the UK’s position on international tax arbitration is not entirely clear.

Both international and EU legal instruments have been used to settle tax disputes in the UK. Reliance on international instruments is possible only where they have been expressly adopted into UK law. However, this is the case for most of the UK’s double tax treaties.

There is no provision for the publication of agreements reached with the tax authority of the other territory, or with the taxpayer.

The most common means used to settle tax disputes are double taxation conventions that have been incorporated into UK law. This is because these can be relied upon directly by taxpayers within the UK tax appeal system.

Independent professionals are hired by taxpayers normally to initiate a request. This is because it is unusual for taxpayers to know of the possibility of making a request without being informed about it by professional advisers. Thus, the suggestion to make a request is normally made by a professional adviser, who is then normally instructed to advise in relation to it.

Administrative disputes do not give rise to any fees or charges payable to HMRC or other public body. However, they can involve significant professional/advisory fees, and significant amounts of management time and expense, depending on the taxpayer, the amount at stake and the complexity of the issue.

There are no fees payable to the First-tier Tribunal or the Upper Tribunal for litigation before them. However, fees are payable for litigation in the High Court, the Court of Appeal and the Supreme Court. The fees are relatively low. Normally, they are due at the start of proceedings, when making an application or when a hearing takes place. They are initially split between the parties but recoverable by the party who succeeds in the litigation.

Generally, no indemnity against pre-litigation costs is awarded by the tribunal or court in favour of the taxpayer (or indeed in favour of HMRC).

There are no fees payable for mediation.

As matters stand, there are thought to be between 20,000 and 30,000 cases pending before the First-tier Tribunal. However, the number is higher than normal because of the coronavirus. In addition, the figure includes a number of class actions, at least one of which involves more than 1,000 taxpayers. So, the effective number of cases is significantly lower. Before the Upper Tribunal, there are perhaps 100 cases pending. No figures are available in relation to the High Court, the Court of Appeal or Supreme Court.

No figures are available to indicate how many cases are initiated and decided each year for each tax.

No statistics are available as regards the percentage of cases in which the taxpayer and HMRC are successful in litigation. Often, there is some degree of mixed success (for example, where the substantive tax decision is upheld but penalties are reduced).

Strategic guidelines to consider in a tax controversy are that taxpayers should obtain the best possible advice at as early a stage as possible, preferably even prior to filing tax returns. This minimises the scope for dispute or, where dispute is inevitable, gives taxpayers the best platform to challenge HMRC’s decisions. Effective tax controversy litigation also requires investigation of the facts to as full an extent as is commercially practicable. All relevant records should be retained, so that the Tribunal does not decide in favour of HMRC simply because an absence of documents prevents the taxpayer from proving the facts on which the case rests.

Old Square Tax Chambers

Lincoln’s Inn

+44 020 7242 2744
Author Business Card

Trends and Developments


Old Square Tax Chambers is a specialist tax chambers in Lincoln’s Inn, London. It comprises 13 barristers, including three Queen’s Counsel, all focusing on UK tax matters. All UK taxes are covered, but a significant amount of chambers' work involves offshore matters and clients based outside the UK but with UK interests. Chambers’ clients include a mix of HNWIs (most frequently in relation to capital gains tax, income tax and inheritance tax, including UK and offshore trusts) and corporate clients (generally on corporation tax and VAT matters). Property taxes, including stamp duty land tax, are a significant part of chambers’ work. Chambers covers both tax advisory work and tax litigation. Advisory work involves one-off transactions (for example, M&A and corporate structuring) and more general tax structuring. Members have appeared in litigation at all levels of the UK court system, including the Supreme Court, and before the European Court of Justice. Recent cases have involved VAT, income tax, national insurance contributions, and HMRC enquiry and investigation powers.

Broadly, the trends and developments in UK tax litigation over the past few years have been, on the one hand, success for the UK tax authorities (HMRC) in defeating tax avoidance schemes, but, on the other, a growth in litigation focusing on procedural issues in tax compliance and disputes arising from genuine uncertainty around the interpretation and application of tax legislation. This will continue. The "Litigation and Settlement Strategy" that HMRC adopted around ten years ago means that few cases settle. Alternative dispute resolution (ADR), involving a facilitator who is an employee of HMRC but not involved in tax collection or assessment functions, can be useful, but only in cases where real questions of judgment arise. Where cases are all or nothing, ADR tends to be unsuccessful. The future depends to a great extent on the approach the UK government takes, following Brexit, to its greater freedom to make decisions in relation to tax, in particular in relation to VAT and customs and excise duties. In addition, at the time of writing (May 2021), the coronavirus is seriously affecting the progress of tax litigation.

HMRC's Growing Success in Tackling Tax Avoidance

HMRC has had significant success in the past ten years in litigation involving tax avoidance schemes. There is no reason to suppose this will change. In the aftermath of the financial crash of 2008, there has been a general shift in society’s attitude to tax avoidance. This has of course been reflected in an increase and broadening of legislation directed at preventing it (for example the introduction of the general anti-abuse rule by Finance Act 2013, rules permitting HMRC to publish details of individuals involved in tax evasion, and rules permitting HMRC to impose penalties on advisers who are involved in abusive tax schemes). However, it seems also to have been reflected in judicial attitudes, as the move that began with the case of Ramsay v Inland Revenue in 1980 to allow courts to approach tax legislation more purposively and the relevant facts more realistically has been expanded, so that tribunals and courts are perfectly willing to recharacterise transactions and look through artificial schemes to apply the tax charge that has been sought to be avoided. This is true of well-known situations such as film finance and similar partnerships (for example, the Eclipse, Ingenious and Samarkand litigations) and also one-off planning.

The latter, in particular, has been challenged by legislation requiring tax advisers to disclose to HMRC any avoidance schemes that they market, within a few days of their starting to do so. This legislation has gradually expanded so as to cover not only its initial targets of income tax, capital gains tax and corporation tax but also now inheritance tax and VAT. HMRC are quick to close down avoidance schemes that are disclosed to them, and also astute to impose penalties where there has been a failure to disclose. Penalties are not imposed where there is a reasonable excuse for not doing so, and this has led to a growing use of external counsel not involved in designing the arrangements in question to give advice as to whether disclosure is required. Advice that disclosure is not necessary can establish a reasonable excuse for a failure to disclose.

Tax Litigation: Tax Tribunals and Judicial Review

Tax litigation in the UK goes through two different avenues. First, most decisions made by HMRC can be appealed to the tax tribunal (all appeals are under statute, so whether this avenue is available depends on whether any statutory provision permits it). The question is whether HMRC made the right or wrong decision. This type of litigation is available for all taxes, and for issues ranging from highly conceptual ones (for example, how claims for repayment of VAT work in the context of a VAT group: Taylor Clark v HMRC [2018] UKSC 35 and Lloyds Banking Group plc and others v HMRC [2019] EWCA Civ 485) to those involving detailed factual uncertainties (for example, how temporary school accommodation has been constructed, including precisely how any foundations have been formed, to work out whether it is "immovable property" for VAT purposes: Sibcas v HMRC [2018] CSIH 49). This type of litigation is generally on the increase, as the UK tax code generally increases in size and HMRC have become more willing to challenge taxpayers on this type of issue. And it is only likely to continue to increase, particularly now that Brexit has taken place. This is because new legislation always brings uncertainty, and Brexit will bring a significant amount of new legislation.

The other avenue for litigation encompasses all the other decisions that HMRC makes, that cannot be appealed to the tax tribunal. These are generally decisions of a procedural nature, rather than on issues of substantive tax law. They may involve, for example, questions as to whether it is reasonable for HMRC to require a taxpayer to provide certain documents, or whether it is reasonable for HMRC to change their policy on how particular provisions of legislation work.

This avenue is judicial review, which involves the supervisory jurisdiction of the general courts: was HMRC entitled to make the decision in question, was it reasonable for HMRC to do so? Thus, this is less advantageous for a taxpayer as (usually) the court is testing whether HMRC acted within its discretion, on points about which different people could reasonably reach different views. But likewise, taxpayers appear to have an increasing appetite for this type of litigation. As a result, judicial review in tax matters in the UK is generally increasing. Particularly in areas such as HMRC’s investigatory powers (for example, Derrin v HMRC [2016] EWCA Civ 15, Jimenez v HMRC [2019] EWCA Civ 51, and Kotton v HMRC [2019] EWHC 1327 (Admin)), HMRC’s powers to allow taxpayers to claim reliefs out of time, and general challenges to the lawfulness of legislation when held up to human rights and EU law, this type of litigation is on the rise.

Human rights and EU challenges have been a particular growth area as HMRC have sought to expand their powers to attack tax avoidance by imposing more and more serious sanctions, such as accelerated payment notices (which require taxpayers to pay penalties up front in order to be entitled to appeal) and the new loan charge rules (charging income tax on any loans from employee benefit trusts outstanding as at 5 April 2019: see for example Finucane v HMRC [2021] CSOH 38 and Le Roux Zeeman v HMRC [2020] EWHC 794 (Admin)). These challenges to legislation are often class actions (in substance), and there has been a growth in taxpayers gathering together to undertake this type of litigation (often through the advisers who gave the initial advice on the structures being challenged by HMRC).

Costs and Funding

Turning to costs, appeals to the tax tribunal, at first instance, involve no costs risk: the taxpayer can ensure that win or lose, they will be liable for their own legal fees but not for HMRC’s. In complex cases, there is the possibility of assuming costs risks; and, given that HMRC’s legal fees tend to be significantly lower than any taxpayer’s, a taxpayer with a strong case may generally prefer to take on the risk of costs. This is particularly because all appeals from first instance involve costs risk: generally, the loser pays. And high-value, complex cases are more likely to be appealed, so that there is probably going to be costs risk in those cases in any event. In judicial review, by contrast, there is inevitable costs risk from first instance onwards.

This leads to funding. The past ten years have seen significant growth in third-party funding, with commercial funders becoming more and more involved in providing funding for big ticket litigation. Funding is available not only by way of general insurance for legal expenses, before the event, but also after the event, in relation to a specific dispute that has already arisen. Either way, funders require independent legal opinions, normally from a barrister (the UK has a split legal profession: see below); but this is in fact a useful thing for a taxpayer considering embarking on significant litigation, as it provides a second, independent opinion on the merits of the taxpayer’s position.


Statistics on alternative dispute resolution are rather difficult to find. Within the past ten years, HMRC introduced a mediation function. This involves an employee of HMRC who has not previously been involved in the issue acting as a mediator, to try to facilitate discussions between the tax inspector and the taxpayer. It is a reasonably informal process, but taxpayers are entitled to have accounting, legal and other experts and representatives present. HMRC mediators fulfil their role very well: indeed, because of the obvious potential for accusations of bias in favour of HMRC, if anything the mediators tend to err on the side of ensuring fairness to the taxpayer. However, the problem with mediation is that it tends to take place at a point in the process when HMRC have already decided they are more likely to succeed in the case than not. So, if the issue is of an "all or nothing" nature (eg, is particular expenditure capital or income, is a taxpayer resident in the UK, which customs classification is the right one for particular goods), mediation is unlikely to lead to a settlement except by the taxpayer conceding the point.

Mediation is much more likely to lead to a negotiated settlement in cases involving a judgment which can be anywhere within a range of possible outcomes, such as the value of shares, or a fair and reasonable apportionment of expenditure between different parts of an asset, or a fair and reasonable apportionment of profits between two accounting or basis periods. In these circumstances, one can often find a solution that both sides are willing to live with, or sometimes a different perspective on the point that emerges through face-to-face discussion in an informal, without-prejudice setting. But apart from mediation, very little, if any, ADR takes place in the tax sphere. One might suppose this to be because the main benefits of (for example) arbitration make less of a difference in the context of tax. The tax tribunal is a relatively informal arena. HMRC has an interest in cases being decided in public, given its obligation of equal treatment among taxpayers. There is no particular saving in costs that can be obtained by arbitrating instead of litigating in the tax tribunal. And the tax tribunal is composed of an impressive set of judges who have significant tax expertise.

The UK's Split Legal Profession

In terms of who gets involved, the UK remains an unusual jurisdiction in that it has a split legal profession. There are solicitors and barristers. On the one hand, solicitors (and accountants) tend to be the first port of call for clients in dispute with HMRC. One often finds that solicitors are instructed more frequently with private client issues, whereas accountants are instructed more frequently for business/indirect taxation issues. This is likely to be because private client questions arise most often in the context of trusts and succession, whereas business taxation issues arise more frequently in the course of drawing up accounts, or submitting tax returns based on accounts. Barristers are engaged either to provide opinions on more complex/higher-value issues, or to represent taxpayers in litigation. While solicitors have acquired more rights to plead cases in the higher courts (and any professional representative can act in the tax tribunal), the bar still offers a body of specialist litigators whose core function is pleading cases in court. Thus, in the more complex, high-value cases one often finds a team of advisers consisting of the taxpayer’s accountants and/or solicitors (both in-house and external), plus one or two barristers who will actually present the case in tribunal or court. So, a somewhat unusual situation but one that has worked for several centuries, and will doubtless continue to do so for several more.

The Impact of COVID-19

Finally, the coronavirus. The tax tribunals having been brought to a virtual standstill for a period of about a month in April/May 2020, impressive efforts were made to restart the litigation process. At the time of writing (May 2021), the tribunals and courts are generally able to hold all types of hearings by videoconference. While this is not as satisfactory a means of hearing cases as "in person" hearings, it is, broadly, good enough to allow litigation to progress more or less as before. In the short term, it is likely to be towards the end of 2021 at the earliest before tax litigation is back to "normal"; in the medium to long term, the only effect likely to last is that it may be that judges and parties become more comfortable with holding procedural hearings by conference or video call. This may continue after coronavirus restrictions are lifted.


In summary, tax litigation in the UK is on the rise, and will continue to be so for the foreseeable future. It may be expected to shift gradually from avoidance schemes (as taxpayers and advisers are deterred by recent, procedural-type legislation from using them) to questions arising from the inevitable uncertainty over the interpretation and application of tax legislation (not least because the volume of new legislation is likely to increase in the short to medium term), and procedural issues where challenges are not to outcomes of tax charges but to the processes leading to those charges. In the medium to long term, the cost of litigation may come down somewhat as procedural hearings are more frequently heard by conference or video call, following experience gained in coronavirus conditions.

Old Square Tax Chambers

Lincoln’s Inn

+44 020 7242 2744
Author Business Card

Law and Practice


Old Square Tax Chambers is a specialist tax chambers in Lincoln’s Inn, London. It comprises 13 barristers, including three Queen’s Counsel, all focusing on UK tax matters. All UK taxes are covered, but a significant amount of chambers' work involves offshore matters and clients based outside the UK but with UK interests. Chambers’ clients include a mix of HNWIs (most frequently in relation to capital gains tax, income tax and inheritance tax, including UK and offshore trusts) and corporate clients (generally on corporation tax and VAT matters). Property taxes, including stamp duty land tax, are a significant part of chambers’ work. Chambers covers both tax advisory work and tax litigation. Advisory work involves one-off transactions (for example, M&A and corporate structuring) and more general tax structuring. Members have appeared in litigation at all levels of the UK court system, including the Supreme Court, and before the European Court of Justice. Recent cases have involved VAT, income tax, national insurance contributions, and HMRC enquiry and investigation powers.

Trends and Development


Old Square Tax Chambers is a specialist tax chambers in Lincoln’s Inn, London. It comprises 13 barristers, including three Queen’s Counsel, all focusing on UK tax matters. All UK taxes are covered, but a significant amount of chambers' work involves offshore matters and clients based outside the UK but with UK interests. Chambers’ clients include a mix of HNWIs (most frequently in relation to capital gains tax, income tax and inheritance tax, including UK and offshore trusts) and corporate clients (generally on corporation tax and VAT matters). Property taxes, including stamp duty land tax, are a significant part of chambers’ work. Chambers covers both tax advisory work and tax litigation. Advisory work involves one-off transactions (for example, M&A and corporate structuring) and more general tax structuring. Members have appeared in litigation at all levels of the UK court system, including the Supreme Court, and before the European Court of Justice. Recent cases have involved VAT, income tax, national insurance contributions, and HMRC enquiry and investigation powers.

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