Going to the tax tribunal? Join the queue
It was recently reported that there is now a backlog of 30,000 cases waiting to be heard by the first tier tax tribunal as at April 2015. This compared with some 10,000 cases five years ago. Anyone who finds themselves in the unfortunate situation of having an intractable dispute with HMRC will therefore find themselves having a long wait until their case can be heard.
It will be apparent to any tax professional who scours the tribunal reports looking for matters of general importance, or perhaps even just interest, that frequently cases brought before the tribunal will involve very small sums of money. Until recently cases involving £100 late filing penalties were common, until HMRC put forward the suggestion that people in such cases should plead reasonable excuse, which HMRC would then accept in a perfunctory manner.
Surely, it must be against the backdrop of this vast backlog and the comparatively small sums of money frequently at stake, that the Ministry of Justice’s consultation process has been started, under which, it is proposed that fees be charged for a case to be taken to tribunal. The proposed fee charges are as follows:
To file an appeal with the First-tier Tribunal:
- £50 to issue paper and basic cases;
- £200 for standard and complex cases.
Then, if the appeal proceeds to a hearing the proposed fees for the hearing are:
- Basic appeal £200;
- Standard appeal £500;
- Complex appeal £1,000.
Whilst the sums are comparatively small, these proposals nevertheless leave one with a conflict. HMRC does not always get it right and frequently where there is disagreement, the internal review procedures that HMRC operate seems to give the impression of being entirely self-serving and the Revenue Adjudicator or the Ombudsman are not always appropriate ways forward for a taxpayer.
With more and more circumstances in which penalties can be charged, it is vital that there is a system where access to justice can be ensured. Surely a person manifestly wrongly charged a penalty of £250 or even £500 should not be deterred from seeking justice? Indeed, from a viewpoint of principle, the notion of a person having to pay a tribunal fee to seek protection from state action in these cases feels totally wrong.
However, equally, where a system exists under which you join a queue at number 30,000 and then wait your turn is hardly acceptable – justice delayed is justice denied.
It would seem likely that the inconvenience and cost to the State of taxpayers having the audacity of not agreeing with HMRC’s analysis and therefore clogging up the system will lead to the future imposition of fees, whatever representations are made by the professions. The ensuing reduction in cases coming before the tribunal will have every appearance of being another instance of Government acting upon the basis that the ends justifies the means.