News & Insights

The latest tax developments and VAT round-up for the month.

Silverthrone tax digest covers the developments most likely to affect individuals, trusts, estates and businesses. If you would like to discuss anything here in more detail, please get in touch with your usual contact.

1. Private client

1.1 UK resident despite a move to Brussels

The Upper Tribunal has confirmed that a property developer who moved to Brussels in 2006 remained UK resident for the two tax years in dispute.

Mr McCabe argued that he left the UK in April 2006 to build a European business through a Belgian company. The tribunal agreed with the First-tier Tribunal that his frequent visits, his family home, his regular attendance at Sheffield United matches and his continuing UK business interests meant there was no clear break in his pattern of life, so he remained resident under the old case-law rules for 2006/07 and 2007/08. Under the UK/Belgium tax treaty he had a permanent home in both countries, but his centre of vital interests stayed in the UK. Residence now depends on the statutory residence test, but anyone planning to move abroad should take advice before they go and keep good records of their days and ties.

McCabe v HMRC [2024] UKUT 280 (TCC)

1.2 No business relief for a wild fishery

A fishery on the River Itchen did not qualify for inheritance tax business relief because it was mainly a business of holding investments.

The deceased had run the fishery for about 17 years until her death in 2020, maintaining the river, managing a small syndicate of anglers and selling day permits. The tribunal accepted that real work was involved, but found that the business mainly earned its income from granting rights over the land, so relief of more than £800,000 was refused. Families who own land-based businesses, such as sporting rights or lettings, should check how the investment test applies to them and keep their succession plans under review.

Demetriou & Anor v HMRC [2024] UKFTT 830 (TC)

1.3 Payment after a pension transfer was unauthorised

A man who received cash shortly after his overseas pension scheme bought shares has lost his appeal against the unauthorised payments charge.

In 2015 Mr Greene transferred about £193,000 of pension savings to a Gibraltar scheme, which used £48,000 to buy shares; eight days later the company involved paid him £36,480. The tribunal held that it was for Mr Greene to show that the payment was authorised, and his evidence fell well short. HMRC’s assessment, reduced by agreement to £14,592 once the surcharge was dropped, was upheld. Offers to release pension money early should be treated with great caution, as the tax charges can be heavy.

Greene v HMRC [2024] UKFTT 872 (TC)

1.4 Self Assessment: autumn deadlines approach

Anyone who needs to file a 2023/24 tax return for the first time must tell HMRC by 5 October 2024, and paper returns are due by 31 October.

New landlords, the newly self-employed and others with untaxed income should register now if they have not already done so. The paper return deadline of 31 October is three months earlier than the online deadline of 31 January 2025; last January 1.1 million returns were filed late. Filing early also gives time to plan for the balancing payment, which can be paid to HMRC in several ways.

2. PAYE and employment

2.1 Football referees: Supreme Court finds mutuality and control

The Supreme Court has held that individual match contracts for part-time football referees had enough mutuality of obligation and control to be capable of being employment contracts.

HMRC argued that PGMOL should have operated PAYE and paid National Insurance on fees paid to referees in the National Group. The court decided that once a referee accepted a match there were obligations on both sides, and that PGMOL had enough control through its standards, assessments and the option of not offering further matches. The case was sent back to the First-tier Tribunal to decide, looking at all the facts, whether the referees were employees. Businesses that engage people job by job should not assume that freedom to turn down work rules out employment. Please note that in 2026 the First-tier Tribunal decided that the referees were not employees, and HMRC confirmed in June 2026 that it would not appeal.

HMRC v Professional Game Match Officials Ltd [2024] UKSC 29

2.2 Host employer liable for NICs on offshore catering staff

A UK catering company was liable for £6.8 million of secondary Class 1 National Insurance on workers formally employed by a US group company.

Aramark had transferred around 700 offshore staff to a US affiliate in 2004, which then supplied their services back to Aramark for its North Sea catering contracts. The tribunal found that Aramark controlled the workers’ day-to-day activities, so it was the host employer under the NIC rules and had to pay employer contributions for the period from August 2011 to April 2014. Groups using overseas employers or secondments should check who directs the work in practice and review their payroll arrangements accordingly. Please note that the Upper Tribunal dismissed Aramark’s appeal on 9 September 2026, following its earlier decision on the host employer rules.

Aramark Ltd v HMRC [2024] UKFTT 832 (TC)

2.3 Employee’s expense claims: HMRC discovery fails

An employee who claimed unreimbursed travel and subsistence costs has won his appeal because HMRC could not show that it had made a valid discovery.

Mr Lowe, who worked in the water industry, claimed tax deductions for the difference between his business travel costs and the amounts his employer repaid. HMRC raised assessments of almost £13,000 for four years, but the officer who made them did not attend the hearing and there was no evidence of what the officer actually believed. The tribunal set the assessments aside without deciding whether the claims were correct. Employees should keep mileage logs and receipts, and anyone facing an assessment should check that HMRC has met the conditions for raising it.

Lowe v HMRC [2024] UKFTT 826 (TC)

3. Business tax

3.1 Protective assessments cannot tax the same profit twice

HMRC assessments that charged both income tax and capital gains tax on the same property disposals were invalid.

HMRC was unsure whether Mr Wyatt’s property disposals in 2007/08 and 2009/10 were trading or capital, so it issued discovery assessments that charged both. The tribunal held that an assessment must reflect the tax the officer believes is due, and the officer had never thought both taxes were payable on the same profits, so the assessments were invalid. HMRC had already issued replacement assessments on the trading basis, and whether Mr Wyatt was trading is still to be decided. Property investors should keep clear records of their intentions when buying, as these can decide whether capital gains tax or income tax applies.

Wyatt v HMRC [2024] UKFTT 867 (TC)

3.2 Settlement with HMRC held binding despite a penalty

A business that agreed through alternative dispute resolution to withdraw its appeals was held to that agreement, leaving a £472,500 penalty payable.

After mediation in 2020, HMRC accepted that no VAT was due because of bad debt relief, and the agreement recorded that the appeal against a penalty for a deliberate inaccuracy was withdrawn. The partnership later argued that it had signed only because it believed no penalty would be payable. The tribunal found the wording clear and the mistake one-sided and unknown to HMRC, so the agreement stood. Before signing any settlement with HMRC, make sure it deals expressly with every tax, penalty and interest amount in dispute.

Andrew Quay Hull LLP v HMRC [2024] UKFTT 842 (TC)

3.3 Adviser’s view was no excuse for ignoring information notices

Pension scheme administrators who relied on their adviser’s view that HMRC information notices were invalid had no reasonable excuse for failing to comply.

The administrators received the notices in January 2018 and were told by their adviser that they need not comply because the schemes had been wound up. They neither complied nor appealed, and £300 penalties were followed by daily penalties of up to £60 a day. The tribunal held that reliance on advice is an excuse only where the taxpayer takes reasonable care, and the administrators had not questioned obvious inconsistencies. If you receive an information notice you think is wrong, appeal it within the time limit rather than ignore it.

Hill & Anor v HMRC [2024] UKFTT 844 (TC)

4. VAT and indirect taxes

4.1 Prompt payment discount: VAT due on the full price

The Upper Tribunal has confirmed that TalkTalk could not account for VAT on a discounted price where customers did not pay promptly.

Between January and April 2014 TalkTalk offered customers 15% off if they paid within 24 hours, but only about 3% did so; it accounted for VAT on the discounted price for everyone, and HMRC assessed about £10.6 million. The tribunal held that the discount was a separate offer that customers accepted only by paying quickly, so supplies to those who did not were not made on terms allowing a prompt payment discount. Since 2015 (May 2014 for telecoms and broadcasting) VAT has been due on the amount actually paid, so businesses offering early payment discounts should ask us to check that their invoices and systems reflect this.

TalkTalk Telecom Ltd v HMRC [2024] UKUT 284 (TCC)

4.2 Silver trader denied input tax

A jewellery retailer lost £310,184 of input tax because it should have known that its silver deals were connected with VAT fraud.

Microring made ten back-to-back purchases and sales of silver in late 2015 and early 2016 at a margin of about 1%, never handled the metal and paid its suppliers only once its customers had paid. HMRC had warned the company that the metals sector was affected by fraud, but its checks on suppliers were limited. The tribunal found that the only reasonable explanation for the pattern of trading was a connection with fraud. Businesses in high-risk sectors should keep records of proper supplier due diligence and walk away from deals that look too easy.

Microring Ltd v HMRC [2024] UKFTT 874 (TC)

4.3 15% SDLT rate on a company’s purchase of its owners’ former home

A company that bought its shareholders’ former home for £750,000 could not escape the 15% rate of stamp duty land tax.

GMR Property Ltd bought the house in June 2021; the owners lived there while their new home was renovated, and it was let to a third party from April 2022. Relief for property rental businesses is withdrawn where a connected person is permitted to occupy the dwelling, and the tribunal found that the owners’ occupation was intended, so additional SDLT of £77,500 was due. Anyone buying residential property through a company should take advice before exchange, especially where family members may live there.

GMR Property Ltd v HMRC [2024] UKFTT 871 (TC)

5. Key dates

The main deadlines and events for September to November 2024 are set out below.

6. And finally

6.1 A wartime Budget in September 1939

Less than four weeks after Britain declared war, the Chancellor, Sir John Simon, presented an emergency Budget on 27 September 1939. The standard rate of income tax, already 5s 6d in the pound, went up to 7s for the rest of 1939/40 and to 7s 6d for a full year, the equivalent of 37.5%.

The same Budget brought in an excess profits tax of 60% on business profits above a pre-war standard, charged on profits made since 31 March 1939. Eighty-five years later, the basic rate of income tax stands at 20%.