Yeovil Golf Club
| Jurisdiction | UK Non-devolved |
| Judgment Date | 10 September 2013 |
| Neutral Citation | [2013] UKFTT 490 (TC) |
| Date | 10 September 2013 |
| Court | First-tier Tribunal (Tax Chamber) |
[2013] UKFTT 490 (TC)
Judge Rachel Short, Mr Richard Corke.
Mr Paul Clifford appeared for the Appellant
Mr Martin Priest, representing HM Revenue and Customs, appeared for the Respondents
Value added tax - Late appeal -Repayment claim - Golf green fees - Strike out application - HMRC procedures misleading - Application dismissed - Extension of time to appeal granted - Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009 (SI 2009/273), r. 8- 1994, s. 83G(6)
The First-tier Tribunal (FTT) has dismissed HMRC's application to strike out the Club's claim and has extended the time-limit for appealing. This allows the Club's appeal to proceed.
HMRC wished to strike out the Club's appeal under Tribunal Procedure (First tier Tribunal) (Tax Chamber) Rules 2009 (SI 2009/273), r. 8 because the appeal was allegedly two years and five months late.
The time limits for appealing against a decision of HMRC concerning VAT are in VATA 1994, s. 83G (1)(a). Generally, appeals must be made within 30 days of the date of the issue of the HMRC document notifying the decision.
The overriding objective of the Tribunal Rules is to deal with cases fairly and justly (SI 2009/273, r. 2).
On 10 March 2009, Mr Clifford on behalf of the Club claimed that exemption, rather than standard-rating, applied to green fees. In a letter dated 26 May 2009, HMRC rejected the claim. On 1 August 2009, Mr Clifford replied to that letter stating that he wished to appeal against HMRC's decision. However, HMRC wrote to Mr Clifford on 17 August 2009 stating that the result of their statutory review of their decision was to uphold their decision. Mr Clifford responded by phoning both HMRC and the Tribunal to ask whether he must make a further appeal. No documentary evidence of these telephone conversations was produced to the FTT. Apparently, he was told that, since details of his claim was already held, there was no need to make a further claim.
After the decision in Bridport and West Dorset Golf Club LtdTAX[2011] TC 01214 was published, the Club wrote to HMRC on 9 June 2011 asking about the VAT repayment which it now believed was due. HMRC responded on 27 June 2011 by referring to their letters of May and August 2009 and stated that "I can find no documents relating to a tribunal appeal in respect of our letters of 26 May 2009 or 17 August 2009" and that "unless you can show that a valid appeal has been lodged with the Tribunal, no valid claim exists and no repayment can be considered". Mr Clifford wrote to HMRC on 10 August 2011 stating that an appeal had been lodged which stood behind the Bridport case.
Mr Clifford then discussed the matter with the FTT and was told that he should lodge a new appeal, which he did on 27 January 2012.
Previous cases in this area demonstrate that the FTT should allow a late appeal only in exceptional circumstances (para. 16 of the decision).
The FTT decided that:
(2) Mr Clifford believed that he had made a valid appeal; and
(3) this belief arose partly due to HMRC's confused procedures in 2009 when the appeal rules had changed.
Mr Priest for HMRC accepted that:
(2) the way in which Mr Clifford's correspondence had been dealt with was incorrect; and
(3) the current procedures include asking Mr Clifford to confirm that he wanted to appeal to the FTT.
The FTT decided that this confusion was compounded by the conversations which Mr Clifford had with HMRC and the Tribunal Service in August 2009 during which there could have been some confusion between existing claims made by Mr Clifford concerning membership fees, for which appeals had been received, and the claim regarding green fees.
The FTT considered each of the following tests in the Civil Procedure Rules 1998 (SI 1998/3132), r. 3.9:
(2) interests of administering justice
(3) assuming that the appeal has some merit, the FTT did not think that it is in the interest of justice to refuse the Club the right to appeal due to an honest error or mistake;
(4) whether application made promptly
(5) Mr Clifford had acted promptly in doing what he thought was required to appeal;
(6) whether failure to comply intentional
(7) the FTT decided that there was no intentional failure to comply with the correct procedures;
(8) whether there was a good explanation for the failure
(9) the FTT did not think that there is a good explanation for the failure. Both HMRC's confusion as to the appeal procedures and the statements made by the Tribunals that the Club had existing appeals on record led Mr Clifford to believe that no further action was required to pursue the appeals;
(10) compliance with other rules and directions
(11) the Club had complied with other rules and directions in this matter;
(12) whether the failure was caused by the party or its legal representative
(13) this matter did not affect the FTT decision;
(14) fixed date could still be met
(15) it remains possible to extend the time limit for appealing. The Bridport case has still not been finally decided;
(16) effect of failure to comply
(17) for HMRC, this means one less appeal to handle. For the Club, this could remove an opportunity of claiming relief; and
(18) effect of granting relief
(19) for the Club, this would put it back in the position which it believed it was in, i.e. standing behind the Bridport case. For HMRC, this would mean allowing an appeal to proceed when technically the requirements for appealing have not been met. However, this does not seem to give rise to a significant risk of a large number of similar claims being made to HMRC's disadvantage and contrary to the law, because the circumstances established by the Club are unlikely to be replicated in many other cases.
The FTT decided that this is an exceptional case and it is in the interests of justice for the Club's appeal to be allowed to proceed (para. 30 of the decision).
This is a victory for common sense. Arguably, at an early stage a senior officer at HMRC should have realised the mistake in having reviewed the decision and then allowed the appeal to proceed without the need for the FTT to get involved.
For commentary on late appeals, see the CCH VAT Reporter at 61-440.
[1]This is an appeal against an application by HMRC to strike out the Appellant's appeal under rule 8 of the Tribunal Procedure (First tier Tribunal) (Tax Chamber) Rules 2009 (the "Tribunal Rules") on the basis that the appeal was made two years and five months out of time. The appeal concerns the VAT treatment of "green fees" charged by the Appellant, Yeovil Golf Club ("Yeovil") for the periods September 1973 - August 1989 and January 1990 - December 2008. The correct VAT treatment of green fees is currently under consideration in the Tax Tribunals (the leading case being Bridport and West Dorset Golf Club LtdTAX[2011] TC 01214).
[2]This appeal was heard before this Tribunal on 7 February 2013 and was adjourned in order for the parties to provide more specific evidence of the correspondence and other communications between HMRC and the Appellants relating to the appeal for these particular periods. This information has now been provided. The Appellant has a number of similar appeals with HMRC which are stood behind this above mentioned case.
[3]The time limits for making an appeal in respect of a decision of HMRC concerning VAT are set out at Value Added Tax Act 1994 section 83G subsec-or-para 1s 83G(1)(a) VATA and stipulate that appeals must be made within 30 days of the date of the issuance of the HMRC document notifying the...
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