TC09506 - [2025] UKFTT 00497 (TC)

It then goes on to deal with costs in the following terms:

“Costs: In an appeal which has been categorised as “complex” the Tribunal has a general power to award costs and is likely to award costs against the unsuccessful party. If you wish to opt out of this costs regime, you must apply to the Tribunal within 28 days from the date of this letter”. (Emphasis in the original letter).

In a letter dated 22 September 2023, from HMRC to the appellant, HMRC told the appellant that they could not correspond with Mr Ved until he had submitted the appropriate form of authority; notified the appellant that he could apply for alternative dispute resolution (and Mr Thompson-Jones, the author of that letter and HMRC’s representative at the hearing indicated that he thought the matter might be suitable for mediation); explained to the appellant the consequences of the tribunal having categorised the appeal as complex: and asking him to confirm, by 2 October 2023, whether he wished to apply for ADR and whether he had appointed a representative.

In particular, having identified that the Tribunal had assigned the proceedings to the complex category, the letter said “This also means that Rule 10(1)(c) applies, namely costs in complex cases. If a taxpayer wishes to be excluded from potential liability, they will need to deliver a written request to the Tribunal within 28 days of receiving the notice the case had been allocated to the complex category. You should be aware of this and seek advice from those representing you”.

The appellant asserts that he passed this letter over to Mr Ved without any real consideration of it. I accept this and find it as a fact. I also find as a fact that Mr Ved received this letter. That this is so is evidenced by an email from Mr Ved to Mr Thompson-Jones dated 2 October 2023 which refers to the 22 September 2023 letter. In that email Mr Ved states that he had passed all the documents relating to this case to “tax experts who are currently reviewing the documents and will advise us on the matter” and that “we will be in touch as soon as we hear from a tax expert”.

In cross examination in the hearing of the reinstatement application, Mr Ved accepted that he had not advised the appellant about the possibility of opting out of the cost regime. He thought he had advised the appellant about ADR. He also accepted that he had not diarised to follow up receipt or otherwise of the statement of case.