[2025] UKUT 00278 (TCC)

These claims are brought by way of judicial review of decisions issued by the defendants (HMRC) in 2021 and 2022, in which HMRC decided that the claimants had no entitlement under the Disguised Remuneration Repayment Scheme 2020 (DRRS) to refunds of amounts referable to income tax and Class 1 National Insurance Contributions (NICs) paid by them by way of settlements with HMRC, to avoid the impact of the Loan Charge legislation in Finance (No. 2) Act 2017. The DRRS was set up pursuant to ss. 20 and 21 of the Finance Act 2020 in response to an independent government-commissioned report by Sir Amyas Morse in 2019, which had found elements of the Loan Charge legislation to be unjustifiable.

The claims challenge the lawfulness of HMRC’s decisions on the basis of HMRC’s interpretation and application of certain eligibility conditions for repayment under the DRRS. Those conditions concern whether HMRC had “no power to recover” the relevant amounts of income tax and NICs at the time of the settlements, and whether “reasonable disclosure” of specified information had been made by the claimants in their tax returns. The claimants seek orders from the Tribunal quashing the disputed decisions and ordering HMRC to allow their repayment claims.

We refer to the claimants in case UT/2024/000037 as Fluid Scotland and Fluid London respectively (and together the Fluid claimants), and the claimant in case UT/2024/000066 as Airedale. The claims in both cases were filed in the High Court. Permission for judicial review was given by Foster J on 21 December 2023 (Fluid claimants) and by Sheldon J on 16 April 2024 (Airedale). In each case upon grant of permission the proceedings were transferred to this Tribunal. On 28 May 2024 Judge Raghavan directed that the claims should be heard together given the similarity of the issues raised.

The HMRC officers who made the review decisions under challenge (Louise Robinson in the case of the Fluid claimants and Samantha Fletcher in the case of Airedale) provided witness statements. These sought to explain how they had carried out their reviews and their understanding of the relevant statutory tests they had applied. The Fluid claimants had prior to the hearing been given limited permission to cross-examine Ms Robinson on the subject of the test she had applied in relation to the “reasonable disclosure” eligibility condition. HMRC also relied on a witness statement from Felix Bracher, an officer who had been involved in the operational aspects of the DRRS. On behalf of Fluid Scotland and Fluid London,witness statements were provided by their respective Managing Directors, Peter O’Connor and Adrian Wynne. The Fluid claimants also relied on witness statements from Mary Tierney, a Tax Director at Bennett Brooks chartered accountants. On behalf of Airedale a witness statement was provided by its Finance Director, Craig Thomson.

Submissions at the hearing were made by Mr Goodfellow KC and Mr Elliott for the Fluid claimants, Mr Mullan KC for Airedale, and Mr Stone KC for HMRC. Following the hearing we received further written submissions from all parties on two further questions sent by the Tribunal on 22 May 2025.