TC09583 - [2025] UKFTT 00865 (TC)

In accordance with the limited concession made by the Appellant we set as our foundation that the Appellant was not entitled to the SDIL credit it claimed in the Relevant Period. For what it is worth we consider the concession to reflect the statutory provisions in section 39 FA17 and regulation 15 of the Regs.

As HMRC stated in the Entitlement Decision “you are not entitled to claim tax credits” we consider that HMRC formed and communicated their view to that effect.

With less vigour than its other submissions, the Appellant contends that HMRC has no statutory power to decide that the Appellant was not entitled to the credits it claimed because HMRC have no power to withdraw them where, on the facts and applying the provisions of regulations 15 – 18 of the Regs, entitlement is not established.

We reject the Appellant’s submissions in this regard. Whether entitlement arises in any particular set of circumstances is simply a question of applying the facts to the legal requirements of entitlement as set out in the Regs. Before us it was conceded that the Appellant was not entitled to the credits, and we can see no basis for concluding that HMRC are excluded from forming that conclusion and communicating it to the Appellant.

We are reinforced in this view by the terms of paragraph 1(n) Schedule 10 FA 17 which expressly grants the recipient of a decision on entitlement to credits to bring an appeal against such a decision. The Appellant exercised its right to bring such an appeal.

Paragraph 15 Schedule 10 FA 17 applies to such appeals, and we may allow the appeal against the Entitlement Decision if we consider that HMRC could not reasonably have been satisfied there were grounds for the decision. In light of the Appellant’s concession, HMRC’s decision in this regard was entirely reasonable and we refuse the appeal to the extent that it relates to HMRC’s decision on entitlement as expressed in the Entitlement Decision.