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Hardship accepted

13 June 2017
Issue: 4603 / Categories: Tax cases

CRC v Elbrook (Cash and Carry) Ltd, Upper Tribunal (Tax and Chancery Chamber), 10 May 2017

Requirement to pay tax under appeal

The taxpayer appealed against a VAT assessment for £770 000. Under VATA 1994 s 84 a condition for appealing was that the tax must be paid but the taxpayer said to do so would cause hardship. The First-tier Tribunal found in favour of the taxpayer so HMRC appealed.

The Upper Tribunal noted that it could interfere with the First-tier’s finding only if it had made an error in law. Further  s 84 was intended to strike a balance between preventing abuse of the appeal system by delaying payment of the disputed tax and providing relief when to do so would cause hardship. The merits of the appeal were not in point; what was material was whether the taxpayer’s right of appeal was stifled by a requirement that would cause hardship.

The judge said consideration of the resources available to...

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