Our experts at DSR Tax Claims know how hard it is to find good, quality information about HMRC’s tax regulations that is easy to understand, and that’s why we have created these handy guides to tell you everything you need to know. Our aim is to make life easier for our clients and that is why we want to share our expertise with you. You can also call our friendly team on 0330 122 9972 – we’re the tax experts you can trust.
What are tax tribunal appeals?
A tax tribunal (also known as the First-Tier tribunal) is a way for you to challenge certain (but not all)decisions by HMRC. You can also use them to challenge certain decisions by the Border Force or Serious Crime Agency if they relate to your tax affairs.
The tribunal is independent of HMRC (and government in general) and is designed to look at all sides of the argument objectively and without bias before they come to a decision. It is preferred that you use a tribunal as a ‘last resort’ when dealing with disputes with HMRC and it is strongly recommended that you try ADR (Alternative Dispute Resolution) first before heading to a tribunal. With ADR, you can have the option of allowing a third-party to work with you and HMRC to resolve your dispute, as a neutral mediator. However, if this isn’t suitable or you find that you are still unable to reach a resolution, you can then take your case to a tribunal.
You can appeal certain HMRC decisions, such as:
- Decisions about ‘direct tax’ – such as Income Tax, PAYE, Capital Gains Tax, National Insurance contributions, Statutory Sick Pay or Statutory Maternity Pay, Corporation Tax or Inheritance Tax. You must have appealed to HMRC first though – a tribunal should never be your first port of appeal for these types of issues.
- Decisions about ‘indirect tax’ – such as VAT or excise duty and customs duty. In these instances, you can appeal straight to the tribunal.
When HMRC write to you to tell you of their initial decision, the decision letter will give you a time limit in which you can appeal and you must appeal within that time limit – late appeals will not usually be heard.
Decisions about such taxes as Council Tax or tax credits are handled differently and won’t come under the jurisdiction of a First-Tier Tribunal.
Before you appeal any decision, you might want to seek expert advice. This might be from Citizens Advice, TaxAid, TaxHelp for Older People (if you are over 60) or from a tax adviser or accountant. Our expert team are always available to help so call our friendly team on 0330 122 9972.
What if you can’t pay HMRC?
You are usually expected to pay HMRC what they say you owe them up front and by their deadlines. If you are sure you can’t pay HMRC what they say you owe them, you can make a ‘hardship application’ to delay your payment. Only if you are refused the right to delay payment by HMRC can you then appeal to the tribunal.
However, if your appeal is about a penalty you have been issued by HMRC, you don’t have to pay that up front. The appeal will decide whether you have to pay the penalty.
What if you are appealing about seized goods?
Your first call should be to ask HMRC (or the Border Force if it was they who seized your goods) to take your case to the magistrates’ court if you think they shouldn’t have taken your goods. This is known as starting ‘condemnation proceedings’ and should be your first stop on the road to appealing the decision. This is because a tribunal can’t make the decision about whether your goods were seized with good reason – it just doesn’t have that power.
You can appeal to a tribunal in the following circumstances if HMRC (or Border Force):
- Refuses to return your seized goods
- Says you have to pay to get your seized goods back
- Tries to charge you a penalty
- Sends you an assessment for duty
You must initially appeal to HMRC (or Border Force) before you can appeal to a tribunal.
What about ‘closure applications’?
You are allowed to appeal to a tribunal to apply for a ‘closure notice’ if HMRC open an enquiry to check your Self Assessment tax return relating to ‘direct tax’ (such as Income Tax, Capital Gains Tax or Corporation Tax) and you want them to close the enquiry. The tribunal will then decide whether or not HMRC should close the enquiry. You can’t appeal in this way against an enquiry into your ‘indirect tax’.
What about appealing an NCA decision?
If your tax return is being investigated by the National Crime Agency (NCA) if, for example, because they suspect you are involved in money laundering, you can appeal their decision to a tribunal. In this instance, you will need to write to the NCA rather than appeal to a tax tribunal.
The address to appeal NCA decisions is:
National Crime Agency
Units 1 to 6 Citadel Place
How do you begin an appeal to the tax tribunal?
You can either appeal online or through the post.
To appeal online (or apply to close an enquiry) you will need:
- A scan or photo of your original notice or review conclusion letter
- The reason(s) why you wish to appeal – the judge has to be able to understand your side of the argument fully so make sure you are able to fully explain your grounds for appeal
- A completed authorisation form, if you are requesting someone else to represent you (and they aren’t a practising solicitor or barrister). You can download one from the HMRC site if you need to
- Details of your dispute with HMRC, including any monetary amounts you are appealing (as well as the amounts of any penalty charges you are appealing)
To appeal by post, you will need to download and complete a ‘notice to appeal’ form (form T240). If you want to close an existing enquiry, you will need form T245 instead. You then need to send your completed form to the address noted on the form.
If you need any help or have any questions about your appeal, you can contact the Tax Tribunal helpline on 0330 123 1024. You can call between 8.30am and 5pm Monday to Friday. The helpline can’t provide you with any legal advice though – you will have to obtain your own advice from other sources.
Once the tribunal has received your appeal, they will write to you to tell you what happens next. They may need you to send more documentation to support your case.
Not all submitted cases will get a hearing but you are allowed to ask for one. If you are going to receive a hearing, the tribunal will write to you giving you at least 14 days’ notice and they will also inform you of what you will need to do.
What do you need to do if you get a hearing?
If you are granted a hearing, you must make sure you bring copies of all of the relevant documents for your case (such as accounts, letters and invoices) to the hearing as well as your notice to appeal. You must also bring any correspondence you have received from HMRC about your case (including the initial decision by HMRC and any response you subsequently made to HMRC). It’s possible that HMRC will send you a ‘document bundle’ of all of their supporting documents before the hearing – if they do, you need to make sure you bring those documents with you as well, whether your case is deemed to be ‘standard’ or ‘complex’. If you don’t bring these documents with you, your appeal may be delayed.
Who will be at the hearing?
Hearings are usually held in public, rather than behind closed doors, and the tribunal will be made up of a tribunal panel (including a judge and possibly a tax expert, if your case is seen to be suitably complex to require one) and a tribunal clerk to record all the proceedings. You are also allowed to bring people to support you – these may include a representative to act on your behalf (such as a lawyer, tax adviser or accountant), a friend or family member as well as any witnesses you may require.
What happens at a hearing?
You or your representative will present your case to the panel. You will have to explain what has been agreed and what you think is wrong, as well as present any evidence you have to support your case (including the testimony of any witnesses you have). Representatives of HMRC will then present their side of the case to the panel, explaining why they disagree with the reasons for your appeal.
The members of the tribunal panel (as well as representatives of HMRC) may ask you questions during the hearing.
How will you receive the tribunal’s decision?
The way you receive the decision may depend on how your case has been heard. If you have had a hearing and the case was deemed to be a ‘basic’ case, you might get a decision on the day. If you don’t you should get it in writing within 1 month. If the case was classed as a ‘standard’ or ‘complex’ case and you had a hearing, you should receive your decision in writing within 2 months.
If you didn’t receive a hearing, you will get your decision in writing and will be based on the information in your appeal form (as well as the supporting documentation you provided).
What happens if you lose your case?
If you lose your case and the tribunal find against you, you may still have the option to take it further by either getting the decision set aside or by asking for permission to appeal the tribunal’s decision.
You can ask for the decision to be ‘set aside’ (which means that the decision is cancelled) but you can only do this if you think that a mistake was made in theinitial decision or appeals process. Your decision letter will explain how you do this if this is the course of action you wish to take.
You may be able to ask for permission to appeal the tribunal’s decision if you think that the tribunal made a legal error with your case. If you think they didn’t apply the law correctly or they didn’t fully explain their decision, you can ask them for a full written explanation (if they haven’t already provided you with one). You have to request this within 28 days of the date on your decision notice and the decision letter will tell you how you request this full explanation. You can then ask for permission to appeal but you must do this within 56 days or the date given on the full written explanation. To appeal, you need to download and complete an appeal form (T247) and send to the following address:
First-tier Tribunal (Tax Chamber)
PO Box 16972
Once you have sent your form, a judge will decide whether you have grounds to appeal to a higher tribunal (known as the Upper Tribunal (Tax and Chancery)). If you are refused permission to appeal, you do still have the right to apply to the Upper Tribunal for permission to appeal.
How can you find information about previous appeals and legislation?
It is recommended that you research previous decisions before you decide to appeal to the tax tribunal. You can search the tribunal decisions database to see any previous decisions and whether they apply to your circumstances. This may help you to decide whether you wish to proceed with your appeal.
The tribunal is legally bound to follow the rules set out in Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009. You can download a copy of these rules from the GOV UK site and again, these may help you to decide how to proceed with your case. Because the tribunal can only follow these rules, they won’t be able to make a decision in your favour that goes against these rules.
How can DSR Tax Claims help?
We know that appealing an HMRC decision can be a complicated affair, even with our helpful guide to tell you everything you might need to know. It’s all very well reading about it and knowing what HMRC’s stand on it is – but how do you apply that to your own circumstances? It can seem like an absolute minefield but help is always available and you don’t need to battle through this alone. Our team of experts at DSR Tax Claims are always on hand to help our clients and our excellent standing with HMRC means that we can make sure you don’t fall foul of their regulations, while claiming your maximum tax relief. We can even take care of all that paperwork and deal with HMRC on your behalf too. Call our friendly team on 0330 122 9972 – we’re the tax experts you can trust.