[2025] UKUT 00275 (TCC)

The FTT did not arguably err in law in making its Decision that the application for a closure notice should be dismissed. The application before HMRC was one for a closure notice. The FTT made no decisions regarding the allegations raised against HMRC of abuse of power or conspicuous unfairness because she was in effect ‘trapped’ into making a late return. However, even though these allegations were raised before the FTT, there is no arguable basis in fact for them. The FTT, without arguable error, found that there was no clear or unambiguous statement that HMRC had extended the deadline. It is inevitable therefore, that there could be no clear and unambiguous statement that could give rise to a legitimate expectation nor abuse of power nor oppressive and unreasonable behaviour by HMRC (such as ‘trapping’ her into late filing).

The UT has considered on a number of occasions the extent of the FTT’s jurisdiction to consider public law arguments such as legitimate expectation, for example in the decision in Caerdav Ltd v Revenue And Customs [2023] UKUT 179 (TCC)at [152]-[153]

“152.The starting point is therefore that appeal grounds which concern public law arguments should be pursued in judicial review proceedings rather than before the FTT. However, we, like the FTT, accept that the FTT may have jurisdiction to consider appeal grounds based on public law arguments (such as legitimate expectation) depending on the statutory provisions under consideration.

An example of judicial review being the appropriate avenue to pursue an allegation of abuse of power by HMRC (see the fourth ground) is the claim for judicial review before the UT in The King (On The Application Of Gloucestershire Hospitals NHS Foundation Trust [2023] UKUT 28 (TCC).

Therefore, the FTT may have a limited ‘public law’ type of jurisdiction if granted so by statute. As the authorities dictate, it would be a question of statutory construction of s.28A(6) TMA 1970 as to whether the FTT has jurisdiction to consider public law arguments such as legitimate expectation or abuse of power on a closure notice application.

However, there is no need to rule on the extent of the FTT’s jurisdiction on a closure notice application because even if the Applicant’s public law arguments could fall within the FTT’s jurisdiction (which is a matter of statutory construction of the tribunal’s jurisdiction to issue closure notices in s.28A(6) TMA 1970), there is no arguable basis in fact for them for the reasons set out above.

Finally, the question of whether and why the tax return was filed late was a precursor to the question of whether the enquiry should be closed. The FTT made no arguable error in deciding that the return was filed late so that the enquiry was validly opened within time. The public law arguments would not undermine the FTT’s findings on the validity of the enquiry once opened and that a closure notice should be refused because there is no arguable merit to the allegations that the Applicant had been ‘trapped’ into making a late return (and would better have been taken on a judicial review seeking to quash the notice opening the enquiry).

The FTT gave rational and sufficient reasons at [53]-[66] for deciding that it would not direct HMRC to close that enquiry nor issue a closure notice. This was on the basis that the FTT found that HMRC did not have the full facts on which to assess whether the Applicant’s self-assessment tax return was correct. It was satisfied that there were reasonable grounds for not issuing the final closure notice.

This ground of appeal is not arguable and is dismissed.