[2024] UKUT 00436 (TCC)

An appeal to the Upper Tribunal from a decision of the FTT can only be made on a point of law (section 11 of the Tribunals, Courts and Enforcement Act 2007). The Upper Tribunal has a discretion whether to give permission to appeal. It will be exercised to grant permission if there is a realistic (as opposed to fanciful) prospect of an appeal succeeding, or if there is, exceptionally, some other good reason to do so: Lord Woolf MR in Smith v Cosworth Casting Processes Ltd [1997] 1 WLR 1538.

It is therefore the practice of this Chamber of the Upper Tribunal to grant permission to appeal where the grounds of appeal disclose an arguable error of law in the FTT’s decision which is material to the outcome of the case or if there is some other compelling reason to do so.

Many of the grounds of appeal included in the Applicant’s submissions are that HMRC’s investigation and the case against him were incorrect because the assessed credits and income was from gambling (or repayment of debt or inheritance) and not from work at the New Tyke Inn. In other words these grounds challenge findings of fact made by the FTT. The grounds engage the test in Edwards v Bairstow [1956] AC 14 (HL) for when an error of law may be established in relation to a finding of fact. A finding may only be made in error of law if:“no person acting judicially and properly instructed as to the relevant law could have come to the determination under appeal” - not simply that there was insufficient evidence to support the FTT’s factual findings but there was no evidence at all or that the findings were perverse or unreasonable.

In Volpi v Volpi [2022] EWCA Civ 464 (“Volpi”), Lewison LJ set out a more recent summary of the legal position in appeals on points of law challenging findings of fact. There is a stringent threshold before the appellate courts will interfere with first instance fact finding.

If a finding of fact is to be challenged as made in error of law, the onus is on the Applicant to identify all the evidence which was relevant to each finding and show that it was one the tribunal was not entitled to make– see Georgiou v Customs and Excise Commissioners [1996] STC 463, at 476:

“… for a question of law to arise in the circumstances, the appellant must first identify the finding which is challenged;

secondly, show that it is significant in relation to the conclusion;

thirdly, identify the evidence, if any, which was relevant to that finding; and

fourthly, show that that finding, on the basis of that evidence, was one which the tribunal was not entitled to make.

What is not permitted, in my view, is a roving selection of evidence coupled with a general assertion that the tribunal's conclusion was against the weight of the evidence and was therefore wrong. A failure to appreciate what is the correct approach accounts for much of the time and expense that was occasioned by this appeal to the High Court.”