[2025] UKUT 00278 (TCC)

The two overarching legal issues raised by the claims are:

Once these legal issues have been determined, it will be necessary to consider their application to the decisions taken by HMRC for each of the claimants in relation to each of the disputed years. Where it is established that HMRC did have a power to recover the relevant amount, that is a complete answer to the repayment claim; and where HMRC reached that conclusion it did not go any further. Where, however, it is concluded that HMRC did not have a power to recover, if the amount concerns a loan made on or after 9 December 2010, it is then necessary to consider whether reasonable disclosure was made. HMRC accordingly did (as set out above in relation to Fluid Scotland and Airedale) consider the reasonable disclosure issue for years in respect of which it had accepted that it did not have the power to recover all or part of the voluntary restitution amounts in the settlement agreements.

In relation to the claims by the Fluid claimants that were decided by HMRC on the basis of the no power to recover condition, for the tax years involving loans made on or after 9 December 2010, if we were to find (contrary to HMRC’s decision on those claims) that HMRC did not have power to recover those amounts of tax, the question would arise as to how to address the reasonable disclosure point. It was (by the time of the hearing) common ground that in that situation the decision should be remitted back to HMRC to make a decision on the reasonable disclosure issue. In the event, we do not need to do so in light of our decision set out below.