In Caroline Sweby v HMRC [2022] TC08453, the First Tier Tribunal (FTT) refused HMRC’s attempt to extend time limits to serve their statement of case. HMRC had failed to follow the correct procedures and were time-barred from pursuing their appeal.

  • Ms Sweby raised an Appeal to the FTT on 9 June 2016.
  • The appeal was classed a standard case, meaning HMRC had to deliver a statement of case to the FTT and the appellant within 60 days.
  • On 25 August 2016, HMRC applied for an extension pending decisions on other cases with similar fact pattens. This was granted and meant HMRC had 60 days to deliver the statement of case once these other cases had been decided.
  • The first round of cases was decided on 16 July 2018 and HMRC had until 16 September 2018 to present their case.
  • Further cases with similar fact patterns were presented to the FTT in October 2018.
  • HMRC intended to apply for a further extension to await the decision in these further cases, but due to a clerical error and a change in litigator, no such application was made.
  • HMRC contacted Ms Sweby’s advisors in 7 July 2021 in respect of settling the appeal.
  • Ms Sweby’s advisors told HMRC that the time limits had expired in 2018 and they considered the case closed.
  • HMRC retrospectively applied to the FTT to extend the time limits to issue their statement of case.
  • The FTT granted this extension on the proviso that Ms Sweby did not object which she duly did.
  • HMRC subsequently provided further information to the FTT to consider.

The FTT refused HMRC’s application to extend the time limits to serve their statement of case as:

  • Permission to extend should not be granted unless the tribunal is satisfied that on balance it should.
  • In satisfying itself that the application should be refused, the FTT considered:
    • The length of the delay.
      • A delay of over three years was considered serious and significant.
  • The reasons the default has occurred.
    • HMRC acknowledged that correct procedures and time limits had not been followed.
    • The FTT considered that the reasons for the delay given by HMRC had little merit.
  • Other circumstances of the case.
    • The FTT allowing an extension when due process had not been followed would undermine the legislative time limits.
    • HMRC’s actions were not consistent with their (incorrect) position that the extension applied until the second round of cases were decided, their statement of case was still provided beyond 60 days of that later decision.
    • The prejudice suffered by HMRC in being unable to pursue their appeal is a result of their own actions and is outweighed by the prejudice that allowing the appeal to proceed would cause to Ms Sweby.

Useful guides on this topic

How to appeal an HMRC decision
Disagree with an HMRC decision? How to appeal, what type of decision can you appeal and what are your different options when you disagree with HMRC? What are the key steps in making an appeal?

How to appeal a penalty for late filing of a tax return or late payment of tax. This section covers appeals in relation to tax returns and payments for income tax Self Assessment, Corporation Tax, PAYE, Non-residents CGT, VAT, ATED, SDLT and IHT.

External links

Caroline Sweby v HMRC [2022] TC08453

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