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Appeal against recovery assessment not to proceed unless tax pre-paid

 

"(3A)     Subject to subsections (3B) and (3C), where the appeal is against an assessment which is a recovery assessment for the purposes of this subsection, or against the amount of such an assessment, it shall not be entertained unless the amount notified by the assessment has been paid or deposited with HMRC." (VATA 1994, s.84(3A))

Appeal against recovery assessment not to proceed unless tax pre-paid

VAT appeal not late because hardship application not made

"[32] From the cases referred to above, it seems to me to be clear that the under both FA72 and VATA94 the fact that an appeal cannot be entertained does not mean that it has not been validly made.  It does not seem to have been argued in the cases that a tribunal entertained an appeal when it received and acknowledged a notice of appeal.  The cases, in particular Hubbard, suggest that the tribunal only begins to entertain an appeal when it lists it for hearing...

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[36]...It seems to me that section 84(3) VATA and rule 22(1) are entirely consistent with the authorities which I discuss above in making a distinction between making an appeal and entertaining or proceeding with an appeal.  For reasons set out above, I consider that starting proceedings is not the same thing as entertaining or proceeding with an appeal.   

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[39] In summary, I have decided that SNMP’s appeal in 2017 was made in time and, notwithstanding the fact that the disputed tax was not paid and no application for hardship was made at that time, it was a valid notification of the appeal..." (SNM Pipelines Limited v. HMRC [2022] UKFTT 231 (TC), Judge Sinfield)

VAT appeal not late because hardship application not made

Recovery assessment

Assessment to recover overpaid interest

"(5)     An assessment under subsection (1) above shall be a recovery assessment for the purposes of section 84(3A)." (VATA 1994, s.78A(5))

Recovery assessment

Exception: pre-payment would cause hardship

"(3B)     In a case where the amount determined to be payable as VAT or the amount notified by the recovery assessment has not been paid or deposited an appeal shall be entertained if—

(a)     HMRC are satisfied (on the application of the appellant), or

(b)     the tribunal decides (HMRC not being so satisfied and on the application of the appellant),

that the requirement to pay or deposit the amount determined would cause the appellant to suffer hardship." (VATA 1994, s.84(3B))

Purpose is to strike a balance between abuse of the appeal mechanism and stricture of having to pay before appeal

 

“It is clear that s 84 VATA is intended to 15 strike a balance between, on the one hand, the desire to prevent abuse of the appeal mechanism by employing it to delay payment of the disputed tax, and on the other to provide relief from the stricture of an appellant having to pay or deposit the disputed sum as the price for entering the appeal process, where to do so would cause hardship.” (HMRC v. Elbrook (Cash & Carry) Limited [2017] UKUT 181 (TCC), §§16…17, Marcus Smith J and Judge Berner)
 

FTT decision final

(3C)     Notwithstanding the provisions of sections 11 and 13 of the Tribunals, Courts and Enforcement Act 2007, the decision of the tribunal as to the issue of hardship is final." (VATA 1994, s.84(3C))

However

"[37] For the reasons I have given I would allow Totel's appeal and hold that it is entitled to appeal to the Upper Tribunal against the ruling as to hardship. I would rule that the insertion of s.84(3C) by paragraph 221(5) was ultra vires. Since I have reached that view I shall say nothing as to whether Totel has any greater chance of success before the Upper Tribunal than it had before Simon J in establishing any error of law." (Totel Ltd v. HMRC [2012] EWCA Civ 1401, Moses LJ; Arden LJ and Lord Neuberger MR agreed).

Exception: pre-payment would cause hardship

Procedure

Application must be made to HMRC first

 

“It is clear from the wording of s 84 VATA, that the tribunal can consider a hardship application only if an application has first been submitted to HMRC as regards which HMRC are not satisfied that the requirement to pay or deposit the relevant amount would cause the person hardship.  In other words the tribunal can only decide a hardship application if such an application has first been made to HMRC and refused by them.  As that was not the case (as the appellant had merely requested extra time to pay the debt), the tribunal was not able to deal with this issue at the hearing.” (Khan v. HMRC [2017] UKFTT 731 (TC), §20). 

Procedure

Burden of proof on taxpayer

“There was no dispute that the burden of proof is on the appellant to establish hardship for both VAT and excise duty purposes- see for example John Cozens at [18], referring to Buyco…There is no contemporaneous information at all (see ToTel 2 at [79]). There is also no obligation on HMRC to seek any such information: to repeat, this is the appellant’s application and the burden of proof is on it, not HMRC.” (Sintra Global Inc v. HMRC [2016] UKFTT 726 (TC), §§14…51, Judge Falk).

 

Based on admitted evidence

“If the tribunal has fixed a cut off point for the admission of material, it is not an error of law for the Tribunal to ignore any later furnished evidence. (ToTel 1 at [86])” (Sintra Global Inc v. HMRC [2016] UKFTT 726 (TC), §12, Judge Falk).
 

Oral evidence unlikely to be good enough

 

“Since HMRC is unlikely to have much if any accounting information about the appellant, in the ordinary case the appellant is the only one who can demonstrate hardship; and the absence of contemporaneous accounting information is in itself a justification for the tribunal to conclude, in an appropriate case, that it can place little if any weight on the appellant’s oral assertion that it is unable to afford to pay.” (ToTel Ltd v HMRC [2014] UKUT 485 (TCC), §79, Nugee J).

 

Historic information unlikely to be good enough

 

“But the answer to this is that Judge Bishopp was not satisfied that one could simply infer that the position was the same at April 2009 when he had very little up to date information to go on. This was a conclusion he was in my judgment plainly entitled to reach. Again otherwise it would mean that an applicant who could in fact pay without hardship at the time of the hearing could rely on information that was 15 months out of date showing that he could not pay, and then submit that his application had to be allowed as there was no evidence to contradict that. This again cannot sensibly be supposed to be the law.” (ToTel Ltd v HMRC [2014] UKUT 485 (TCC), §80, Nugee J).
 

Contemporaneous accounting information usually essential

 

“Furthermore, as Nugee J said in ToTel 2 at [79], since HMRC is unlikely to have much accounting information about the appellant, in the ordinary case the appellant is the only one who can demonstrate hardship, and the absence of contemporaneous accounting information is in itself a justification for the tribunal to conclude, in an appropriate case, that it can place little if any weight on the appellant’s oral assertion that it is unable to afford to pay…This is not a case where, on the evidence, those French companies [owned by the taxpayer] could be regarded as the source of readily-available finance, such as was the case in DGM UK Limited. In contrast to that case, there was here no evidence of a course of activity between Elbrook and its associated companies to suggest that the reasonable 30 requirements of Elbrook, including the requirement to pay or deposit the disputed tax, would ordinarily be met by cash advances to Elbrook by one or more associated companies.” (HMRC v. Elbrook (Cash & Carry) Limited [2017] UKUT 181 (TCC), §§29…48, Marcus Smith J and Judge Berner)

 

“The absence of contemporaneous accounting information is a justification for the tribunal to conclude that it can place little if any weight on the appellant's assertion that it is unable to afford to pay. (ToTel 2 at [79])… We accept that the total amount assessed is significant and that many companies would not have sufficient readily available resources to pay it, but we have nothing like sufficient information about the appellant’s financial position to determine what its resources are. We do not know exactly what bank accounts it has or had, we have no accounting information and no information about payments it made that may have been by way of investment or distribution. We also have no evidence about business that may have been done in cash, which was either not banked or banked in an account or accounts that have not been identified.” (Sintra Global Inc v. HMRC [2016] UKFTT 726 (TC), §§12…55, Judge Falk).

 

Question of whether there was sufficient financial information is a value judgment for the Tribunal

 

“The question of the sufficiency of evidence is essentially one for the value judgment of the FTT, having regard to the particular circumstances of the case, and the evidence as a whole. Although, as Nugee J said in ToTel 2, at [79], it is possible for a tribunal in particular circumstances to place little weight on the witness evidence of an appellant in the absence of contemporaneous accounting information, that does not exclude the value of such witness evidence in all cases.” (HMRC v. Elbrook (Cash & Carry) Limited [2017] UKUT 181 (TCC), §55, Marcus Smith J and Judge Berner)
 

Burden of proof on taxpayer

Would suffer hardship, not may suffer hardship

 

“As the Tribunal said in Tradium at [58], referring to comments of Judge Bishopp in ToTel, the appellant “may” be put to financial hardship but we simply don’t know. We do not accept that the comments in John Cozens at [54] and [55] affect this. The facts are completely different: this is not a case of the appellant failing to explain some entries on his bank statement. The appellant has failed to provide any explanation, or any up to date documentation, at all.” (Sintra Global Inc v. HMRC [2016] UKFTT 726 (TC), §55, Judge Falk).

 

Possible requirement to suffer harm/no harm if no business

 

“It is also of some relevance that, on the appellant’s own case, the appellant no longer conducts business. We note the comment in Buyco at [8] where hardship is interpreted as meaning that the business would be harmed if tax was paid. Whilst we do not think that the test of hardship has no application to a company without an active business, the statement in Buyco does put an appropriate focus on the requirement for the appellant to show that payment (or the provision of security for excise duty purposes) would actually harm it.” (Sintra Global Inc v. HMRC [2016] UKFTT 726 (TC), §57, Judge Falk).
 

Would suffer hardship, not may suffer hardship

Test for hardship

Test is capacity to pay without financial hardship, not just capacity to pay

 

“The test is not simply of capacity to pay, but capacity to pay without financial hardship. Thus, the mere existence of cash or other readilyrealisable resources will not necessarily suffice, if the employment of those resources in paying the disputed cash would have consequences that would cause financial hardship.” (HMRC v. Elbrook (Cash & Carry) Limited [2017] UKUT 181 (TCC), §22, Marcus Smith J and Judge Berner)

 

“The test is one of capacity to pay without financial hardship, not just capacity to pay. (ToTel 1 at [82(ii)], ToTel 2 at [55] approving Seymour at [57])” (Sintra Global Inc v. HMRC [2016] UKFTT 726 (TC), §12, Judge Falk).

 

Consider each assessment / hardship application separately

 

“If there were 25 assessments of £2,000 each, each of which were appealed, and the taxpayer could afford to pay £10,000 without hardship but no more, Don Pasquale indicates that the tribunal could and should require payment or deposit of £10,000 before 5 of the appeals could be entertained, but that the taxpayer could pursue the other 20 appeals without payment or deposit. Nothing in the decision suggests that because the taxpayer could afford to pay £2,000 viewed in isolation, he could be made to pay that sum 25 times over.” (Totel Limited v. HMRC [2014] UKUT 485 (TCC), §30, Nugee J)

 

Should be able to pay from resources which are immediately or readily available

 

“The requirement that the resources be immediately or readily available is a reflection of the structure of s 84(3B), which looks to the existing financial position of the appellant, and does not require enquiry as to possible future action or any potential resources that might become available in the future.” (HMRC v. Elbrook (Cash & Carry) Limited [2017] UKUT 181 (TCC), §22, Marcus Smith J and Judge Berner)

“[82(iii)] The hardship enquiry should be directed to the ability of an appellant to pay from resources which are immediately or readily available. It should not involve a lengthy investigation of assets and liabilities, and an ability to pay in the future, see Seymour Limousines 7 Ltd (above) at [58]. This is a reflection of the broader principle that the issue of hardship ought to be capable of prompt resolution on readily available material.” (R (on the application of ToTel Ltd) v First-tier Tribunal (Tax Chamber) [2011] EWHC 652 (Admin), Simon J).

 

Company not expected to look outside its normal sources for funding or required to sell assets

 

“The availability of resources by way of borrowing may therefore be considered, as where there are unused facilities, or the facilities are immediately available with minimal formality and without the obtaining of those facilities in itself giving rise to financial hardship.” (HMRC v. Elbrook (Cash & Carry) Limited [2017] UKUT 181 (TCC), §22, Marcus Smith J and Judge Berner)

 

“The enquiry should be directed to the ability of an appellant to pay from resources which are immediately or readily available. (ToTel 1 at [82(iii)], Buyco at [8])…A corollary of this is that a business is not expected to look outside its normal sources for funding, nor is it required to sell assets, especially if to do so would take time. (Buyco at 6, Tricell at [55, 56] – to the contrary Kemp.)” (Sintra Global Inc v. HMRC [2016] UKFTT 726 (TC), §12, Judge Falk).

 

“I do not consider that, if a business’s normal bankers will not 25 lend, it should be expected to pursue other sources of finance purely for the purpose of paying the tax in dispute. I consider that I should rely on the fact that a business that needs finance for the business will already have taken reasonable steps to obtain it, and if a business knows that a bank is unlikely to lend in the circumstances I can 30 understand its being reluctant to make a definite request and risk receiving a refusal which might make borrowing more difficult in the future. I also bear in mind that investigating new sources of borrowing may require the incurring of significant expenses, such as valuations of land and legal fees, which might not ultimately achieve any results.” (Buyco Limited and Sellco Limited v HMRC [2006] UKVAT V19752,§8 Judge Avery Jones).

 

Not expected to ask current bank if bank would panic

 

“[The FTT] went on, at [39], to find as a fact that an 11 approach to its bankers could have caused those bankers to panic, and on that basis further borrowing from those bankers was not a realistic proposition. We do not consider that the FTT’s conclusion in this respect is undermined by any failure to find that the existing banking facilities had been exhausted; it is evident that the FTT had 5 in mind both the existing and available resources and the hardship that would be caused to Elbrook’s financial position either in employing those resources to pay the VAT, or by reference to what it could realistically borrow.” (HMRC v. Elbrook (Cash & Carry) Limited [2017] UKUT 181 (TCC), §36, Marcus Smith J and Judge Berner).

 

Equity in a property not sufficient

 

“We agree that ordinarily the possibility of an appellant obtaining access to a new source of borrowing should not be regarded as a resource that is immediately or readily available for this purpose. That is not to exclude such borrowing from being taken into account in particular circumstances, for example where it is shown that arrangements for such finance are at such a stage where it has become readily available. But the mere fact that other sources of finance might be explored, or that an appellant might have equity in a property or other security to support possible borrowing, will not of itself render such borrowing capacity as a resource which is either immediately or readily available.” (HMRC v. Elbrook (Cash & Carry) Limited [2017] UKUT 181 (TCC), §24, Marcus Smith J and Judge Berner)

 

Not expected to sell business assets

 

“Thus, as Dr Avery Jones found in Buyco and Sellco, at [8], a disposal outside the ordinary course of business of assets that were properly purchased for the business would involve an irrevocable step that could cause hardship, whether or not the assets are currently used in the business.” (HMRC v. Elbrook (Cash & Carry) Limited [2017] UKUT 181 (TCC), §25, Marcus Smith J and Judge Berner)

Or non-business assets

 

“What s 84(3B) is directed towards is financial hardship to the appellant; such hardship might be to the business of the appellant, but it could equally be personal financial hardship. There are numerous obvious examples; an appellant who is able to pay only by selling personal investments at a loss, or whose sale would trigger a substantial tax bill that would not otherwise arise. To the extent such assets would be readily realisable, they would be relevant to consider, but so too would be any financial hardship that might arise in consequence of the realisation of those assets. Furthermore, there is no warrant in the statutory language, or in the context, for construing hardship as being confined to hardship in the context of a taxpayer’s business.” (HMRC v. Elbrook (Cash & Carry) Limited [2017] UKUT 181 (TCC), §38, Marcus Smith J and Judge Berner)

 

Process of securing finance using assets will ordinarily militate against the finance being readily available

 

“Ordinarily, however, the process of seeking and completing such finance may be found to militate against such a conclusion. In the absence, therefore, of appropriate circumstances, a conclusion that the prospect of such borrowing would not constitute immediately or readily available 15 resources capable of being realised without financial hardship will be one that is open to a tribunal, and not capable of being displaced as an error of law.” (HMRC v. Elbrook (Cash & Carry) Limited [2017] UKUT 181 (TCC), §41, Marcus Smith J and Judge Berner)
 

Relevance of connected party’s financial position

 

May be taken into account where there is common control and a free flow of resources

 

“On the other hand, as the FTT (Judge John Walters QC) observed in the unpublished decision in DGM UK Limited v Revenue and Customs Commissioners (TC/2011/04619), at [31], each case must be considered by reference to its own circumstances and there is no hard and fast rule, for example, that regard can never be had to the resources of 10 connected (but legally independent) entities where, as in that case, there is common control and the evidence suggests a free flow of resources to meet the needs or requirements of any one entity at the expense of the other or others of them from time to time. It is all a matter of the individual circumstances of the particular case.” (HMRC v. Elbrook (Cash & Carry) Limited [2017] UKUT 181 (TCC), §25, Marcus Smith J and Judge Berner)
 

Relevance of connected party’s financial position
Test for hardship

All or nothing test

 

“Finally, we should note that the test for financial hardship is an “all or nothing” one. The only question is whether payment or deposit of the whole of the disputed tax would cause financial hardship. It is of no relevance that payment of some lesser amount might be capable of being achieved without hardship” (HMRC v. Elbrook (Cash & Carry) Limited [2017] UKUT 181 (TCC), §25, Marcus Smith J and Judge Berner)

“The test is all or nothing: ability to pay part of the VAT without hardship does not matter. (Buyco at [6])” (Sintra Global Inc v. HMRC [2016] UKFTT 726 (TC), §12, Judge Falk).
 

All or nothing test

Assess at time of hearing

“Consistently with the need to consider immediately or readily available resources, the normal rule is that the tribunal should look at the position as at the date of the hearing.” (HMRC v. Elbrook (Cash & Carry) Limited [2017] UKUT 181 (TCC), §25, Marcus Smith J and Judge Berner)

 

“The time at which the question is to be asked is the time of the hearing. (ToTel 1 at [77] approving Buyco at [6], ToTel 2 at [37]).” (Sintra Global Inc v. HMRC [2016] UKFTT 726 (TC), §12, Judge Falk).

 

Not a lengthy investigation

 

“Particularly in the case of a hardship application which should not involve a lengthy investigation of assets and liabilities, there is no need for a lengthy judgment.” (HMRC v. Elbrook (Cash & Carry) Limited [2017] UKUT 181 (TCC), §60, Marcus Smith J and Judge Berner)

 

Unless taxpayer has deliberately put itself in a position of hardship

 

“The statute requires the tribunal to decide whether the requirement to pay or deposit the amount determined ‘would cause’ the appellant to suffer hardship. In the example I have given, it may well be that the appellant will be in financial difficulty if he now has to find the £100,000. But the real cause of that is not the requirement to pay or deposit the £100,000; the real cause is the appellant's own deliberate act in paying away the £200,000 which would otherwise have been available to him for that purpose.” (Totel Ltd v HMRC [2014] UKUT 485 (TCC), §45, Nugee J).

 

“This may be qualified if the appellant has put themselves in a current position of hardship deliberately (eg by extraction of funds otherwise readily available from a company by way of dividend), or if there is significant delay on the part of the appellant (ToTel 1 at [78], ToTel 2 at [44-47], Buyco at [6]).” (Sintra Global Inc v. HMRC [2016] UKFTT 726 (TC), §12, Judge Falk).

 

Or delayed hearing where the delay has caused the inability to pay without hardship

 

“The key factor in the significance of delay is whether it affects causation, in other words whether the delay, or something which has occurred as a consequence of the delay, is the proximate cause of the financial hardship, and not the requirement to pay or deposit the disputed tax…That will necessarily involve enquiry as to the financial position of the appellant at the time of making the appeal to the tribunal. If the appellant was able to afford to pay the disputed tax at that time, and the tribunal concludes that in the intervening period it is the appellant who has caused the financial hardship in some way, the necessary causation condition in s 84(3B) VATA will not be satisfied.” (HMRC v. Elbrook (Cash & Carry) Limited [2017] UKUT 181 (TCC), §57, Marcus Smith J and Judge Berner)

 

“…similar considerations apply where the appellant has been responsible for delaying the hearing of the application. If for example, the appellant can easily afford the £100,000 when the appeal is brought, but is responsible for the hearing of the hardship application being delayed by two years, by which time he will be in difficulties if he has to find it, I do not see why the tribunal should not conclude in an appropriate case that the appellant is again himself the real cause of any hardship that may be caused. Had he not delayed the application, the requirement to pay or deposit the tax in issue would not have caused him hardship, so it is not so much the requirement that is the real cause of the hardship as his own delay.” (ToTel Ltd v HMRC [2014] UKUT 485 (TCC), §47, Nugee J).
 

Assess at time of hearing

Not a lengthy investigation


“Particularly in the case of a hardship application which should not involve a lengthy investigation of assets and liabilities, there is no need for a lengthy judgment.” (HMRC v. Elbrook (Cash & Carry) Limited [2017] UKUT 181 (TCC), §60, Marcus Smith J and Judge Berner)

Not a lengthy investigation

Merits of appeal not relevant

“…there is nothing in s84 which requires the merits of an appeal to be considered, and it would not be appropriate for the FTT on a hardship application to concern itself with the merits of the underlying appeal.” (HMRC v. Elbrook (Cash & Carry) Limited [2017] UKUT 181 (TCC), §19, Marcus Smith J and Judge Berner)

 

“The appellant’s submission that the appeals are meritorious appeared to come close to elevating that question to a self-standing test under which we should allow the application simply because the appeals are meritorious. There is no such test. The sole question is whether the appellant would suffer hardship, and whilst the merits or otherwise of the case should be borne in mind in reaching a decision, they cannot by themselves determine the question.” (Sintra Global Inc v. HMRC [2016] UKFTT 726 (TC), §52, Judge Falk).
 

Merits of appeal not relevant

Difficulty of MTIC accused trader borrowing accepted​

 

"[14] However, I accept the reliability and accuracy of the evidence given by YA. I do so because he gave his evidence clearly and in a manner designed to assist both myself and Ms Udom. He was not evasive. He addressed questions head-on and gave comprehensive, coherent, and, to my mind, wholly plausible answers. I have some experience with MTIC’s I fully understand the difficulties faced by traders who need to borrow funds to enable them to pay their suppliers’ VAT whilst awaiting repayment from HMRC. And the difficulty that those traders face when those repayments are denied. I therefore find it wholly unsurprising that once repayment was denied by HMRC, ABA faced a genuine cash flow difficulty. I also find it unsurprising that if HMRC’s attention then turned to YBA, (and I have no reason to doubt YA’s evidence that this was the case and that he is currently in dispute with HMRC, that dispute having escalated to bring tribunal proceedings) that YBA too, as a repayment trader in part, also faces cash flow difficulties if HMRC have withheld VAT repayments." (ABA Motors Limited v. HMRC [2023] UKFTT 406 (TC), Judge Popplewell)

Difficulty of MTIC accused trader borrowing accepted​

Excise duty hardship applications​

 

"(3)      An appeal which relates to a relevant decision falling within any of paragraphs (a) to (h) of section 13A(2), or which relates to a decision on a review of any such relevant decision, shall not be entertained if the amount of relevant duty which HMRC have determined to be payable in relation to that decision has not been paid or deposited with them unless—

 (a)      the Commissioners have, on the application of the appellant, issued a certificate stating either—
(i)     that such security as appears to them to be adequate has been given to them for the payment of that amount; or
(ii)     that, on the grounds of the hardship that would otherwise be suffered by the appellant, they either do not require the giving of security for the payment of that amount or have accepted such lesser security as they consider appropriate; or
(b)     the tribunal to which the appeal is made decide that the Commissioners should not have refused to issue a certificate under paragraph (a) above and are satisfied that such security (if any) as it would have been reasonable for the Commissioners to accept in the circumstances has been given to the Commissioners.
(3A)     Subsection (3) above shall not apply if the appeal arises out of an assessment under section 8, 10 or 11 of the Alcoholic Liquor Duties Act 1979.]

(3B)     Sections 85 and 85B of the Value Added Tax Act 1994 (settling of appeals by agreement and payment of tax where there is a further appeal) shall have effect as if—

 (a)     the references to section 83 of that Act included references to this section, and
(b)     the references to value added tax included references to any relevant duty." (FA 1994, s.16)

Main principles the same as VAT but not all or nothing test

 

"[64] Sintra is not binding upon me but I agree entirely. The focus is on security and not on ability to pay at any stage." (Reliable Shipping Limited v. HMRC [2023] UKFTT 45 (TC), Judge Anne Scott)

“The test for excise duty purposes is somewhat different. The main relevant cases are Commissioners of Customs and Excise v Mitsui & Co Plc and H.T. Walker [2000] 1 C.M.L.R 85 and, at the First-tier Tribunal level, John Cozens v HMRC [2012] UKFTT 228 (TC) and Tradium Limited v HMRC [2012] UKFTT 421 (TC). The key distinguishing features are that the excise duty test is not “all or nothing”, so criterion (6) in Elbrook does not apply, and the focus is on the question of security, not payment. As explained in Mitsui at [9], the Commissioners are both entitled and bound to require security in lieu of immediate payment, subject to hardship being established.” (Sintra Global Inc v. HMRC [2016] UKFTT 726 (TC), §13, Judge Falk).


HMRC entitled and bound to consider requiring security in lieu of payment

 

"[72] The simple facts are that HMRC were prepared to consider security and offered a lengthy window within which that could have been provided. The appellant just did not do so.

...

[75] In these circumstances, the appellant has not established why security would have caused hardship had it been required. No real or credible explanation was given as to why no security or charge would be given. The appellant elected not to offer security. The appellant has not identified what level of security, if any, would cause hardship and why." (Reliable Shipping Limited v. HMRC [2023] UKFTT 45 (TC), Judge Anne Scott)

“As explained in Mitsui at [9], the Commissioners are both entitled and bound to require security in lieu of immediate payment, subject to hardship being established.” (Sintra Global Inc v. HMRC [2016] UKFTT 726 (TC), §13, Judge Falk).

Query when to consider whether it would cause hardship

"[97] I consider that it is at least, strongly arguable that I should look at the facts as at the date of the hearing. However, I do not require to decide the point since the onus of proof lies with the appellant and that has not been discharged." (Reliable Shipping Limited v. HMRC [2023] UKFTT 45 (TC), Judge Anne Scott)

Excise duty hardship applications​
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