TC09630 - [2025] UKFTT 01071 (TC)

On 21 August 2019, Officer King of HMRC’s “Targeted Enforcement Recovery Unit” or “TERU”, wrote to Mr Di Lellio about the amounts due from him, and how to pay. On 2 September 2019, she called Mr Di Lellio to discuss payment, and recorded that Mr Di Lellio was “under the impression there was an appeal in place”. On the same day, she spoke to Mr Cooke and told him no appeals had been submitted.

On 11 December 2019, Officer King wrote again to Mr Di Lellio, attaching a bankruptcy warning letter. Mr Di Lellio responded by return, saying (emphasis in original):

“I have received your bankruptcy notice of £96,288.86 and draw your attention that the matter is under appeal with the Inspector of Taxes. Furthermore my accountant Thomas Cooke has spoken with the Collector of Taxes and made them fully aware that there is an appeal outstanding and NOT settled. The major item appealed against is an assessment for rent that I did NOT receive of £70,000.”

He asked Officer King to liaise with his accountants, as he was “spending a lot of time with the medical treatment and do not have the energy to deal with this type of worrying correspondence”.

On 6 January 2020, Officer King wrote to Mr Cooke, reminding him of their conversation of 2 September 2019. On 10 January 2020, Officer Fowler wrote to Mr Di Lellio setting out the assessment and penalty decisions, including a step by step summary of the exchanges with Mr Cooke and explaining (again) that no appeals had been received.

On 16 January 2020, Mr Di Lellio wrote a detailed letter to HMRC about the CT and VAT investigations.

On 11 February 2020, Mr Cooke wrote to Officer King, saying “I reiterate that an appeal has been filed against the assessment for rents which he did not receive”.

On or around 14 February 2020, HMRC filed and served a statutory demand. On 19 February 2020, Officer King wrote to Mr Di Lellio explaining the reasons for the demand, and saying, in bold:

“Corresponding with your Accountant Thomas Cooke

There is no appeal held for your company or you personally.”

On 12 February 2020, Mr Cooke requested a statutory review of the CT and VAT assessments, and HMRC agreed to carry out those reviews. On 24 February 2020, Mr Cooke emailed the officer who was carrying out the statutory review of the CT assessments, acknowledging his letter about that review, and adding “we have also requested a review of the assessments made on Mr Di Lellio and have lodged an appeal previously”.

On 3 March 2020, Mr Cooke emailed HMRC, saying that the assessments were “for rent which was not received has been appealed against in 2018 and requested postponement of the tax demanded”.

On 30 June 2020, the statutory demand was set aside by the County Court, following Mr Di Lellio’s application. There was then a delay due to Covid.

On 18 September 2021, Mr Di Lellio wrote to Officer King saying that “an appeal was lodged at the outset” against the inclusion of rental income in the assessments, and he also set out various points relating to the CT and VAT enquiries.

On 21 October 2021,HMRC filed and served a second statutory demand. On 28 March 2022, Deputy District Judge Hayes set that demand aside, having been informed by Counsel acting for Mr Di Lellio that there were open appeals which had not yet been determined.

On 21 September 2022, Mr Doherty of HMRC’s Debt Management Office wrote to Mr Di Lellio saying that no formal appeals were in place, and referring to Officer Fowler’s email of 14 September 2018 which stated that Mr Cooke’s letter asking to stand over the tax was not a valid appeal.

On 3 April 2023, HMRC filed a third statutory demand, and on 17 November 2023 filed and served a related witness statement to the effect that there were no extant appeals. The total figure now sought was £139,029.70. It included (a) the assessments, penalties and PLNs referred to above; (b) income tax for 2016-17 through to 2021-22; (c) two penalties under FA 2008, Sch 36 for failing to provide information; (d) late payment penalties from 2014-15 through to 2020-21, and (e) significant sums by way of interest. Mr Sanders told us that the bankruptcy proceedings have been stayed pending the hearing of Mr Di Lellio’s application.

At some point after the filing of that petition, but before this hearing, Mr Di Lellio paid HMRC £15,842 in part satisfaction of the amounts owed.