HMRC have published their list of tax avoidance litigation decisions for 2024-25. This identifies the results of litigation where HMRC considered that tax avoidance was involved. The summary indicates an almost identical amount of litigation in 2024-25 as in 2023-24, with a stable win rate for HMRC.
Of the 37 cases litigated where the substantive issue considered was tax avoidance, 31 were recorded as wins for HMRC. Among these cases were:
HMRC wins
In JTI Acquisition Company (2011) Limited v HMRC [2024] EWCA Civ 652, the Court of Appeal (CoA) agreed with the Upper Tribunal (UT) and the First Tier Tribunal (FTT) that while the appellant made a commercial acquisition using a group loan, the wider group strategy of securing a tax advantage meant the loan had an unallowable purpose.
In HMRC v HFFX LLP [2024] EWCA Civ 813, the Court of Appeal (CoA) affirmed the Upper Tribunal's (UT's) decision that allocations by a corporate member of a mixed-member partnership to individual members constituted miscellaneous income.
In Syngenta Holdings Limited (SHL) v HMRC [2024] TC0934, the First Tier Tribunal (FTT) ruled that SHL's decision to enter into a loan was driven by the wider group strategy to obtain a tax advantage. The main purpose of securing this tax advantage rendered the loan to have an unallowable purpose.
In Rupert Grint vs HMRC [2024] TC09337, the First Tier Tribunal (FTT) found that a sum of £4.5 million declared by Harry Potter star Rupert Grint on his tax return as a capital gain should have been declared as income, arising from his role in the films.
HMRC losses
In The Executors of Mrs Leslie Vivienne Elborne Deceased & Ors v HMRC [2025] UKUT 00059, the Upper Tribunal (UT) found that an Inheritance Tax (IHT) home loan scheme was valid. The value of a settled property within a deceased's estate could be reduced for IHT purposes by an associated loan note as it was not a 'debt incurred by' the deceased under anti-avoidance legislation.
In MR Currell Ltd v HMRC [2024] UKUT 00404, the Upper Tribunal (UT) set aside a decision made by the First Tier Tribunal (FTT) due to an error of law. This resulted in the UT concluding that a payment from a company to an employee benefit trust was not earnings.
HMRC won all of its procedural, Disclosure of Tax Avoidance Schemes (DOTAS) and judicial review cases.
League table
Results for the three most recent years are summarised in the league table below.
2024-25 shows a notable increase in the number of cases litigated where the substantive issue considered was tax avoidance, but a decrease in procedural cases. Overall, HMRC's success rate has remained broadly consistent over the last three years.
|
2024-25 |
2023-24 |
2022-23 |
|
|
Wins (including partial wins) |
|||
|
Substantive issue of tax avoidance |
31 |
18 |
30 |
|
Procedural cases |
1 |
11 |
13 |
|
DOTAS |
3 |
4 |
6 |
|
Judicial review cases |
1 |
1 |
1 |
| Permission for judicial review on publishing Tax avoidance schemes, promoters, enablers and suppliers |
1 |
2 |
- |
|
Total wins |
37 |
36 |
50 |
|
Losses |
|||
|
Substantive issue of tax avoidance |
6 |
5 |
3 |
|
Procedural cases |
- |
1 |
3 |
|
DOTAS |
- |
- |
1 |
|
Judicial review cases |
- |
- |
- |
|
Total losses |
6 |
6 |
7 |
|
Percentage won |
86% |
86% |
88% |
Useful guides on this topic
DOTAS: Disclosure of Tax Avoidance Schemes
What are the Disclosure of Tax Avoidance Schemes (DOTAS) rules? When should you disclose your use of a tax avoidance scheme? What are the consequences of non-disclosure? How are penalties calculated?
Anti-avoidance: HMRC's spotlights
This is a freeview 'At a glance' guide to HMRC's Spotlights.
What is the Ramsay principle in tax?
Not sure what is meant by the Ramsay principle? Here is a quick guide.
Tax Agents: HMRC's Standard for Agents
Our guide to HMRC's 'Standard for agents', HMRC's approach to tackling bad agent behaviour, and providing a definition of a tax adviser.
Professional Conduct in Relation to Taxation
The Professional Conduct in Relation to Taxation (PCRT), adopted by the main professional accounting and tax bodies, sets out the professional standards that are expected of a member when undertaking tax work.
Named tax avoidance schemes, promoters, enablers
HMRC publish a list of named tax avoidance schemes, promoters, enablers and suppliers. It is not recommended that taxpayers use any of these schemes, as HMRC do not consider that they work and you may end up with a significant tax liability if you engage with the scheme suppliers.
External link