HMRC sought to strike out some appeals “because the totality of the presently available evidence, looked at as a whole, shows that the Appellant does not enjoy any realistic prospect of successfully advancing these appeals” (Mediability v HMRC [2023] UKFTT 315 (TC)). The FTT agreed with HMRC and the application was granted.
The FTT found that:
“Taken together, the documentary evidence … tends inevitably to the conclusion that the … scheme was simply a ‘construct of contracts’, and that the contracts did not in fact reflect the true economic reality.”
There was no realistic prospect of that assessment changing at a full hearing, but the FTT went on to consider whether there was any other evidence to justify allowing the appeals to continue. However, it was “entirely clear” that the scheme was entered into for tax avoidance purposes. The argument being put forward was ingenious but ultimately unproductive. The FTT’s final conclusions were that the appeals were abusive and should be struck out, and the tribunal judge added the following further observations:
“As to justice: Recognising the caution in deploying my strike-out powers, I am nonetheless of the view that the interests of justice are justified in striking out these appeals. They are relitigation, using valuable (and scarce) public resources, many years after the relevant events, and thereby concerning matters which are, on any view, extraordinarily stale.
The interests of public policy are broadly similar, and, in my view, mandate the same outcome. It is neither in the interests of justice as a whole, nor public policy, to permit this Appellant – whether on the basis of ‘further’ evidence (not yet extant) … or on the basis of an ingenious (but, in my view, unsustainable), ex post facto, ‘recharacterisation’, of which there is no evidence – to continue to advance these appeals.”
https://www.bailii.org/uk/cases/UKFTT/TC/2023/TC08775.html
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Value Added Tax, written by Ciaran McGee MA (Oxon), FCA, CTA, is an extensive volume (over 1,000 pages), written primarily for non-VAT specialist accountants and tax advisers.
