Court of Appeal allows HMRC’s appeal in Raftopoulou v HMRC
On 7 December 2017 the Court of Appeal (Arden and David Richards LJJ) allowed HMRC’s appeal against the decision of the Upper Tribunal in Raftopoulou v HMRC [2016] STC 656. The Court of Appeal delivered its decision immediately; a reserved judgment will follow in due course.
The Upper Tribunal’s decision had adopted a novel interpretation of vital parts of the statutory assessment procedures – in particular notices of enquiry and closure notices. The Upper Tribunal had come to the surprising conclusion that a single document could constitute both notice of an inspector’s intention to enquire into a claim and at the same time a closure notice stating the conclusions of the inspector’s enquiry – with no enquiry in the middle. The Upper Tribunal also held that s. 118(2) of the Taxes Management Act 1970 gave tax tribunals a general power to extend time for complying with statutory time limits (for example, as in this case, the time limit for making a claim for repayment of overpaid tax). It is not known if the Court of Appeal’s judgment will address both of these aspects of the Upper Tribunal’s decision.
As the Court of Appeal decided that the appeal should be allowed, it did not go on to hear Dr Raftopoulou’s appeal against the Upper Tribunal’s separate decision ([2015] UKUT 630) refusing an application for a payment in respect of pro bono representation. The jurisdiction to make such an order is limited to certain civil courts, which do not include any statutory tribunals (s. 194(10) of the Legal Services Act 2007). Nevertheless, it was argued by Dr Raftopoulou that the Upper Tribunal could make such an order because s. 25 of the Tribunal, Courts and Enforcement Act 2007 gives the Upper Tribunal the same “powers, rights, privileges and authority as the High Court” in respect of “all other matters incidental to the Upper Tribunal’s functions”. The Upper Tribunal held that this general provision did not override the express jurisdictional limitation in s. 194(10) of the Legal Services Act 2007. As the Court of Appeal did not hear the appeal against that decision, it remains the position that the Upper Tribunal does not have power to make an order for payment in respect of pro bono representation. The same position applies, by analogy in other statutory tribunals such as the Employment Appeal Tribunal.
Chris Stone acted for HMRC, with Hui Ling McCarthy.
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