Case Number: TC09651
[Location/By remote video hearing]
Appeal reference: TC/2021/01192
PROCEDURE – application for a direction that HMRC provide further and better particulars and disclosure of documents in relation to discounted settlement opportunitiesfor large companies involvingEmployee Benefit Trusts in 2015 – refused
Judgment date: 30 September 2025
Before
TRIBUNAL JUDGE KIM SUKUL
Between
JOHN CROOKS
Appellant
and
THE COMMISSIONERS FOR HIS MAJESTY’S REVENUE AND CUSTOMS
Respondents
The application was determined in chambers, in London, on 8 September 2025 on written submissions
DECISION
Introduction
This is the Appellant’s application dated 8 July 2025, pursuant to rule 5(3)(d) of the Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009 (‘FTT Rules’), for a direction that the Respondents (‘HMRC’) provide further and better particulars and disclosure of documents.
Having considered the Appellant’s application, HMRC’s written representations dated 22 July 2025 opposing the application, and the Appellant’s reply dated 15 August 2025, the Appellant’s application is refused.
The reasons for that decision are set out below.
the application
The substantive issues in this appeal concern transactions relating to a ‘Self-Employed Remuneration Trust’ where deductions were claimed in relation to trust costs and contributions.
Employee Benefit Trusts (‘EBTs’) are trusts settled by an employer for the benefit of their employees. The term is used to describe a number of different sorts of trust, although they are generally discretionary trusts.
The Appellant’s application is for the following further and better particulars and documents to be provided:
Provide all documents, including correspondence, meeting notes, in connection with the settlement with large companies where the companies settled for somewhere in the region of 15% in 2015 in connection with EBTs.
HMRC may redact confidential information about taxpayers but must disclose the names of HMRC officers.
HMRC’s explanation as to why users of the remuneration trust were not offered the same discounted offer as the large companies.
The grounds for the application are as follows:
New information has come to light which suggests that HMRC had agreed to discounted deals in 2015, whereby large companies only paid 15% of the tax in dispute due to their use of structures similar to the Self-Employed Remuneration Trust.
This application is based on two publicly available letters from the All Party Parliamentary Loan Charge & Taxpayer Fairness Group dated 1 July 2025, signed by Members of Parliament Sammy Wilson, Greg Smith and Sarah Olney, and addressed to Ray McCann and Rachel Reeves MP, which includes the following passage:
“A Freedom of Information response has been shared with us, which has revealed minutes of a meeting on 17th September 2019 during the 2019 Morse Review between Sir Amyas Morse, the then reviewer and Ray McCann, who is of course, conducing the current review into settlement terms.”
The minutes include Ray McCann telling Sir (now Lord) Morse about this, stating:
“The earlier settlement opportunity that had been open to large companies had included significant discounts, so that eventually the companies settled for somewhere in the region of 15% in 2015”.
The letters include a reference to a freedom of information response, including minutes of a meeting on 17 September 2019, which states:
“The earlier settlement opportunity that had been open to large companies had included significant discounts, so that eventually the companies settled for somewhere in the region of 15% in 2015 (i.e. it took many years for the deal to be made).
The contractors weren’t offered these terms. RM has been hugely critical of HMRC because in his view, much of the problem is down to HMRC’s handling of the whole issue”.
The current settlement terms available to users of Self-Employed Remuneration Trusts do not offer such discounts.
The further and better particulars sought will provide information that will have a direct impact on the way the Appellants will proceed with their appeals.
If it turns out that an 85% discount was offered to large companies, then this firm will seek to argue that the Appellants should be offered a similar deal.
It may well be that many Appellants settle if an 85% discount is available to them thereby reducing costs and avoiding any further recourse to the Tribunal in line with the Tribunal’s overriding objective.
HMRC opposes the Appellant’s application. They make no comment on the interpretation of the comments attributed to Ray McCann, their veracity, nor make any broader representations regarding what settlement terms were or were not available to taxpayers at different times, as they contend that such an enquiry is not necessary in order to dispose of this application.
HMRC argue that the application is premature because the parties’ pleadings are incomplete as the Appellant’s grounds of appeal are vague, and HMRC has not yet filed its statement of case. Without these foundational documents, HMRC argue that the Tribunal cannot assess whether the requested particulars or disclosure are necessary or proportionate. They refer to 4Site Services London Ltd v HMRC [2024] UKFTT 143 (TC) (‘4Site’) where Judge Brown KC sets out that the purpose of further and better particulars is to enable the Appellant to understand the case they must meet. The Tribunal must assess whether the statement of case (alongside any witness statements) provides sufficient clarity. Without a statement of case, such an assessment is not possible.
HMRC also refer to Alpha Republic Ltd v HMRC [2023] UKFTT 750 (TC) and Citibank NA v HMRC [2014] UKFTT 1063 (TC), which reinforce that pleadings define the scope of the dispute and should only include facts necessary to formulate a cause of action or defence.
HMRC further argues that the information sought relating to alleged discounted settlements offered to large companies in 2015 is not relevant to the issues before the Tribunal. The appeal concerns the correctness of HMRC’s decisions, such as tax assessments, not the terms of settlement offers made to other taxpayers. Royal Bank of Scotland Group Plc v HMRC [2020] UKFTT 321 (TC) establishes that disclosure must be closely related to the issues in dispute and must be capable of materially affecting the outcome. Disclosure is not an end in itself. HMRC argues that the Appellant’s request fails this test, as the settlement terms offered to third parties are not relevant to the legal validity of the decisions under appeal.
HMRC also rely on Trustees of the BT Pension Scheme v HMRC [2015] EWCA Civ 713, which confirms that the First-tier Tribunal does not have jurisdiction to conduct judicial reviews. They argue that the Appellant’s application, which seeks to challenge or compare settlement terms, effectively amounts to a judicial review request, which is outside the Tribunal’s powers. HMRC v Hok Ltd [2012] UKUT 363 (TCC) further reinforces the limits of the Tribunal’s jurisdiction, particularly in relation to HMRC’s discretionary decisions, such as whether or not to offer settlement terms.
HMRC argues that the true purpose of the application is to support the Appellant’s efforts to negotiate a more favourable settlement. They point to the Appellant’s own submission that “many Appellants may settle if an 85% discount is available” and contend that this is not a proper purpose for disclosure, which should be focused on assisting the Tribunal in determining the legal issues in dispute.
The Appellant’s response is that the application is both procedurally appropriate and substantively justified, and that HMRC’s objections mischaracterise the purpose and relevance of the request. They argue that this information is directly relevant to the legal analysis of the tax structure under appeal and may materially affect the Tribunal’s decision, that the legal reasoning HMRC applied in offering those discounts is pertinent to the current appeal and that understanding HMRC’s approach to similar structures is essential for ensuring fairness and consistency in the treatment of taxpayers.
The Appellant submits that early disclosure may prevent unnecessary amendments to pleadings and reduce costs, and suggests that obtaining the requested information before HMRC files its statement of case would streamline proceedings, avoid duplication of effort and align with the overriding objective under rule 2 of the FTT Rules, which requires the Tribunal to deal with cases fairly and justly, including avoiding delay and unnecessary formality.
The Appellant also argues that there is potential for early settlement if HMRC’s disclosure confirms that such discounts were previously offered and that such a revelation could prompt HMRC to offer comparable terms to the Appellant, thereby avoiding reputational damage and conserving Tribunal resources. Rule 3(1)(b) of the FTT Rules, encourages the Tribunal to facilitate alternative dispute resolution (‘ADR’) where appropriate and the Tribunal’s Practice Statement on ADR in Tax Disputes emphasises the importance of considering ADR throughout proceedings and warns that unreasonable refusal to engage in ADR may result in costs penalties under rule 10(1)(b).
The Appellant refers to Early Day Motion 1579 in Parliament, which raises concerns about the fairness of settlement terms offered to large companies versus individuals and argues that the issue is of public interest and that transparency through disclosure would serve the interests of justice. The Appellant also refers to Article 6 of the European Convention on Human Rights, which guarantees the right to a fair trial, arguing that this includes the right to access and deploy material necessary for his defence.
Discussion
18.I have carefully considered the submissions made by the parties and the FTT Rules.
19.Rule 5 of the FTT Rules provides:
“(3)…the Tribunal may by direction…
(d) permit or require a party or another person to provide documents, information or submissions to the Tribunal or a party;”
20.Rule 2 of the FTT Rules sets out the overriding objective and parties’ obligation to co-operate with the Tribunal as follows:
“2.—(1) The overriding objective of these Rules is to enable the Tribunal to deal with cases fairly and justly.
(2) Dealing with a case fairly and justly includes—
(a) dealing with the case in ways which are proportionate to the importance of the case, the complexity of the issues, the anticipated costs and the resources of the parties;
(b) avoiding unnecessary formality and seeking flexibility in the proceedings;
(c) ensuring, so far as practicable, that the parties are able to participate fully in the proceedings;
(d) using any special expertise of the Tribunal effectively; and
(e) avoiding delay, so far as compatible with proper consideration of the issues.
(3) The Tribunal must seek to give effect to the overriding objective when it—
(a) exercises any power under these Rules; or
(b) interprets any rule or practice direction.
(4) Parties must—
(a) help the Tribunal to further the overriding objective; and
(b) co-operate with the Tribunal generally.”
21.In determining the application for further and better particulars, I have also considered the comments made by Judge Brown KC in 4Site at [33]:
“[33] In accordance with rule 25 FTT Rules HMRC's statement of case is required to state the legislative provision under which the decision under appeal was made and set out the respondent's position in relation to the case. These requirements are set in the context of the parties' obligations to assist the Tribunal to deal justly and fairly with the matter under appeal. As recently noted by Judge Aleksander in Alpha Republic Limited v HMRC [2023] UKFTT 750 (TC) endorsing the view taken in Citibank NA v HMRC [2014] UKFTT 1063 (TC) the statement of case, where necessary and appropriate by reference to other material including witness statements, must give the appellant the opportunity to properly prepare for the case. By reference to Tejani v Fitzroy Plance Residential Ltd [2020] EWHC 1855 (TCC) and the cases cited therein Judge Aleksander notes that a statement of case "marks out the parameters of the case being advanced", only pleading the facts necessary for the purpose of formulating a cause of action/defence.
[34] The question to be asked when considering the F&BP applications is: does the statement of case (taken together with the witness statements) enable the Appellant in this case to know the case it has to meet?”
22.This approach, which I adopt, highlights the difficulty with this application, and I agree with the submissions made by HMRC that the application is procedurally premature. The pleadings from both parties remain incomplete. In the absence of a fully particularised statement of case from HMRC and clarified grounds of appeal from the Appellant, the Tribunal is unable to assess whether the requested particulars are necessary for the fair and just disposal of the appeal.
23.In determining the application for disclosure, I am guided by the remarks of Rose LJ in Smart Price Midlands Limited v HMRC [2019] EWCA Civ 841:
"[40] Disclosure of documents is not an end in itself but a means to an end, namely to ensure that the tribunal has before it all the information which the parties reasonably require the tribunal to consider in determining the appeal. It is only one step in the overall management of the case which should, as the appeal progresses towards a substantive hearing, identify and if possible narrow the issues between the parties. The scope of the issues in contention at the trial depends in part on the legal test to be applied by the tribunal and in part on the parties' respective positions as to which elements of that test are in contention.
[41]...The extent to which it is useful for everything on HMRC's files on the appellant trader to be available to the tribunal at trial will differ greatly in those different appeals. HMRC argue that the trend in civil proceedings in recent years has been to reduce the amount of disclosure ordered. I would prefer to say that the trend has been to ensure that disclosure is more closely related to the issues in dispute in the proceedings."
24.I am not satisfied that the information sought by the Appellant’s application is relevant to the issues in dispute in this appeal. The appeal concerns HMRC’s decisions and associated assessments, and not the terms of any settlement offers made to, or not made, to the Appellant or others. I do not agree with the Appellant’s assertion that the request for all documents in connection with the settlement in 2015 with large companies for somewhere in the region of 15% in connection with EBTs, and an explanation as to why users of the remuneration trust were not offered the same, is relevant to the legal analysis of the underlying structure in this appeal.
25.Any application for specific disclosure must be tested by reference to relevance and proportionality, and relevance must be considered in the context of the matters which are within the jurisdiction of the Tribunal to determine (see Ford v FCA [2016] UKUT 41 (TCC) at [38]). The Tribunal has no jurisdiction to review or direct the terms of settlement offers made by HMRC to other parties. To the extent that the application seeks to support arguments for improved settlement terms, it falls outside the Tribunal’s statutory remit.
26.The Appellant argues that the overriding objective requires the parties and the Tribunal to further the interests of justice and fairness, which includes avoiding any unnecessary delay and formality in proceedings, and that the provision of particulars and specific disclosure from HMRC may well avoid the need for any further pleadings required from the parties and provide for the early settlement of this appeal because of the potential to avoid reputational damage to HMRC through settlement, if it turns out upon specific disclosure that HMRC had offered heavily discounted deals to corporate users of the EBT structures.
27.I am, however, not persuaded by these arguments. I am not satisfied that the requested disclosure would materially assist in determining the substantive issues in this appeal. The application appears to be directed toward broader policy or fairness arguments, which are not within the Tribunal’s jurisdiction and not, in my view, compatible with a proper consideration of the issues in this appeal.
28.In arriving at my decision, I have considered the Appellant’s submissions regarding the potential for ADR. However, the refusal of this application does not preclude the parties from engaging in ADR should they consider it appropriate.
29.In these circumstances, granting the Appellant’s application would not, in my view, be in the interests of fairness and justice.
conclusion
30.The Appellant’s application for a direction that HMRC provide further and better particulars and for disclosure of documents is therefore refused.
Right to apply for permission to appeal
31.This document contains full findings of fact and reasons for the decision. Any party dissatisfied with this decision has a right to apply for permission to appeal against it pursuant to Rule 39 of the Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009. The application must be received by this Tribunal not later than 56 days after this decision is sent to that party. The parties are referred to “Guidance to accompany a Decision from the First-tier Tribunal (Tax Chamber)” which accompanies and forms part of this decision notice.
Release date: 30th SEPTEMBER 2025
