A couple involved in a long-running fight with HM Revenue & Customs (HMRC) over capital gains tax relief are due to renew hostilities with the taxman following an Upper Tribunal ruling.
The Upper Tribunal has granted Brian and Doreen Foulser’s appeal against an earlier ruling that HMRC should not be barred from taking part in the case. The couple’s appeal had centered on the arrest of their tax adviser, Watkin Gittins of Montpelier Tax Consultants, while the hearing of their case in the First Tier Tax Tribunal was taking place.
Their case had been sent to the First Tier Tax Tribunal after the courts had found they were liable to pay tax on around £27 million-worth of shares, after the relief they claimed on the gifts of those shares was disallowed. The tribunal was tasked with determining the amount to pay.
The charges against Gittins were dropped, and the couple applied for HMRC to be barred from any further involvement in the case, arguing that it would amount to ‘an abuse of process’. HMRC countered with an order that the Foulsers’ application be struck out, arguing that it went beyond the First Tier Tax Tribunal’s jurisdiction.
The tribunal upheld HMRC’s order. However, Upper Tribunal judge Morgan has allowed the couple’s appeal, on the basis that their case could have been misunderstood. He said that the Foulsers’ application also involved the claim that the arrest had made a fair hearing of the case impossible, a claim that was within the tribunal’s remit to assess.
Morgan has sent the case back to the First Tier Tax Tribunal, which will assess whether the arrest has prejudiced the fairness of the case.