Queenscourt Limited v The Commissioners for HMRC

JUDGE JONATHAN CANNAN Introduction

1. The Applicant seeks permission to appeal a decision of the First-tier Tribunal (Tax Chamber) (“the FTT”) released on 3 June 2024 (“the Decision”). The FTT granted permission to appeal on various grounds but refused permission to appeal on one further ground in a decision notice released on 7 August 2024. The Applicant renewed its application to the Upper Tribunal and I refused permission on paper in a decision released on 20 November 2024. The Applicant requested an oral reconsideration which was held by video on 27 February 2025. Charlotte Brown appeared for the Applicant and Dilpreet Dhanoa appeared for HMRC. Both counsel produced helpful skeleton arguments for which I am grateful.

2. Section 11(1) Tribunals, Courts and Enforcement Act 2007 provides for a right of appeal to the Upper Tribunal “… on any point of law arising from a decision made by the First-tier Tribunal…”. I should only grant permission to appeal on a particular ground if I am satisfied that it is arguable, with a realistic prospect of success, that there is a material error of law in the Decision.

3. This decision should be read together with the FTT’s decision which is published under neutral citation The ground on which the Applicant seeks permission to appeal relates to the FTT’s finding that HMRC were not prevented from recovering tax by reason of a legitimate expectation that it would not do so. The FTT dealt with this issue at [180] – [219] of the Decision and found that it was not conspicuously unfair for HMRC to depart from its decision in October 2019 to accept a repayment claim from the Applicant in relation to VAT overpaid in VAT periods 12/15 to 09/18. As such, the Applicant’s arguments based on legitimate expectation were rejected. [2024] UKFTT 460 (TC) .

4. The error of law originally identified by the Applicant was as follows: the FTT erred in law at §214 of the FTT Decision in concluding that detriment was a factor when considering whether the threshold of unfairness had been reached in the Appellant’s legitimate expectation claim…

5. In light of the Applicant’s written and oral submissions it became apparent that the Applicant asserts that the FTT erroneously confined its analysis to weighing up the financial detriment suffered by the Applicant and failed to take into account another relevant factor. Namely, that permitting HMRC to resile from its previous decision to repay the VAT was not conducive to good administration.

6. For the purposes of this application, the Applicant submits that if the FTT had taken that factor into account then it might have concluded that it was conspicuously unfair for HMRC to depart from its decision to repay the tax.

7. On balance, I am satisfied that the ground of appeal identified in paragraph [5] above is realistically arguable and I therefore grant permission to appeal on that ground. Signed: Jonathan Cannan Upper Tribunal Judge Issued to the parties on: 11 th March 2025