[2025] UKUT 00278 (TCC)

The reasons for the disputed decisions by HMRC are set out in the decision letters of Ms Robinson (for the Fluid claimants) and Ms Fletcher (for Airedale), as summarised at §§35–53 above. The witness evidence did not reveal any significant divergence between the understanding of the decision makers (i.e. Ms Robinson and Ms Fletcher) and their written decisions. Nor did Ms Robinson’s reasoning differ as between the respective Fluid claimants, or from that given by Ms Fletcher in her review decision in respect of Airedale.

The core reasoning in all three decisions is as set out at §39 above, and for convenience we replicate it here:

“Although the decisions in place at the time of settlement did not equate to the total settlement amount included in the agreement, they were under appeal and capable of being uplifted prior to settlement either by agreement or varied in a review.

If the decision(s) contains the correct class of employees, and the correct tax periods, HMRC can have the value of the assessment(s) uplifted by a tribunal. HMRC has recent case law in its favour in that respect in the case of The Commissioners for H M Revenue and Customs v C M Utilities-Limited 2017UKUT 0305.”

From this it can be seen that neither Ms Robinson nor Ms Fletcher relied on the deeming provision of §4.5.1. Instead, they relied on the fact that the relevant Regulation 80 determinations and s. 8 decisions were capable of being uplifted either by agreement, or on a review, or by the FTT.

That reasoning, while expressed in concise terms, was correct. It referred to the range of review and appeal mechanisms available to HMRC under ss. 49A–49I TMA 1970, pursuant to which HMRC could have sought to uplift the amounts set out in the Regulation 80 determinations. As we have already explained, we do not consider that the concept of a “power to recover” was intended to mean the power to take a decision on an immediate and unilateral basis. It is sufficient, in our view, that following an appeal by the taxpayer (which Ms Robinson and Ms Fletcher correctly noted was the case here) HMRC was able to provide a “view of the matter” letter which would have put it in a position to recover the varied amount. The way in which that variation would ultimately have been effected would have been by treating the view of the matter as a settlement agreement, or by a variation following a statutory review process, or by the FTT if an appeal had been notified to it by the taxpayer. The reasoning in Ms Robinson and Ms Fletcher’s review decisions, set out above, captured all three of those possible outcomes.