Supreme Imports Limited v The Commissioners for HMRC

The Appellant (“SIL”) is one of the biggest wholesale distributors in the UK and makes large supplies of e-cigarettes and vaping products.

This appeal concerns an out of time claim for £23,476,076 in respect of the VAT quarterly periods 12/18 to 09/22. The legal basis for the claim is that the supplies of e-cigarettes and vaping products were properly subject to the reduced rate of VAT as they were “supplies of pharmaceutical products designed to help people stop smoking tobacco” under Item 1, Group 11, Schedule 7A Value Added Tax Act 1994 (“Item 1”).

Section 83G(1) Value Added Tax Act 1994 (“VATA 1994”) provides that an appeal must be brought within 30 days of the date of HMRC’s decision.

However, this Tribunal has the power to grant permission to appeal out of time: s 83G(6) VATA 1994.

In considering whether to grant permission to appeal out of time, in Martland v HMRC [2018] UKUT 178 (TCC) (“Martland”) Judges Berner and Poole held:

“44.

When the FTT is considering applications for permission to appeal out of time, therefore, it must be remembered that the starting point is that permission should not be granted unless the FTT is satisfied on balance that it should be. In considering that question, we consider the FTT can usefully follow the three-stage process set out in [Denton v TH White Limited [2014] EWCA Civ 906; [2014] 1WLR 3926 (‘Denton’)]:

(1)

Establish the length of the delay. If it was very short (which would, in the absence of unusual circumstances, equate to the breach being ‘neither serious nor significant’), then the FTT ‘is unlikely to need to spend much time on the second and third stages’ – though this should not be taken to mean that applications can be granted for very short delays without even moving on to a consideration of those stages.

(2)

The reason (or reasons) why the default occurred should be established.

(3)

The FTT can then move onto its evaluation of ‘all the circumstances of the case’. This will involve a balancing exercise which will essentially assess the merits of the reason(s) given for the delay and the prejudice which would be caused to both parties by granting or refusing permission.’

45.

That balancing exercise should take into account the particular importance of the need for litigation to be conducted efficiently and at proportionate cost, and for statutory time limits to be respected. By approaching matters in this way, it can readily be seen that, to the extent they are relevant in the circumstances of the particular case, all the factors raised in Advocate General for Scotland v General Comrs for Aberdeen City [2005] CSOH 135; [2006] STC 1218 (Footnote: ¹) and Data Select Limited v HMRC [2012] UKUT 187 (TCC); [2012] STC 2195will be covered, without the need to refer back explicitly to those cases and attempt to structure the FTT’s deliberations artificially by reference to those factors. The FTT’s role is to exercise judicial discretion taking account of all relevant factors, not to follow a checklist.

46.

In doing so, the FTT can have regard to any obvious strength or weakness of the applicant’s case; this goes to the question of prejudice – there is obviously much greater prejudice for an applicant to lose the opportunity of putting forward a really strong case than a very weak one. It is important however that this should not descend into a detailed analysis of the underlying merits of the appeal. In R (Hysaj) v Secretary of State for the Home Department [2014] EWCA Civ 1633;[2015] 1WLR 2472 (‘Hysaj’) Moore-Bick LJ said this at [46]:

‘If applications for extensions of time are allowed to develop into disputes about the merits of the substantive appeal, they will occupy a great deal of time and lead to the parties’ incurring substantial costs. In most cases the merits of the appeal will have little to do with whether it is appropriate to grant an extension of time. Only in those cases where the court can see without much investigation that the grounds of appeal are either very strong or very weak will the merits have a significant part to play when it comes to balancing the various factors that have to be considered at stage three of the process. In most cases the court should decline to embark on an investigation of the merits and firmly discourage argument directed to them.’

Hysaj was in fact three cases, all concerned with compliance with time limits laid down by rules of the court in the context of existing proceedings. It was therefore different in an important respect from the present appeal, which concerns an application for permission to notify an appeal out of time – permission which, if granted, founds the very jurisdiction of the FTT to consider the appeal (see [18] above). It is clear that if an applicant’s appeal is hopeless in any event, then it would not be in the interests of justice for permission to be granted so that the FTT’s time is then wasted on an appeal which is doomed to fail. However, that is rarely the case. More often, the appeal will have some merit. Where that is the case, it is important that the FTT at least considers in outline the arguments which the applicant wishes to put forward and the respondents’ reply to them. This is not so that it can carry out a detailed evaluation of the case, but so that it can form a general impression of its strength or weakness to weigh in the balance. To that limited extent, an applicant should be afforded the opportunity to persuade the FTT that the merits of the appeal are on the face of it overwhelmingly in his/her favour and the respondents the corresponding opportunity to point out the weakness of the applicant’s case. In considering this point, the FTT should be very wary of taking into account evidence which is in dispute and should not do so unless there are exceptional circumstances.

47.

Shortage of funds (and consequent inability to instruct a professional adviser) should not, of itself, generally carry any weight in the FTT’s consideration of the reasonableness of the applicant’s explanation of the delay: see the comments of Moore-Bick LJ in Hysaj referred to at [15(2)] above. Nor should the fact that the applicant is self-represented – Moore-Bick LJ went on to say (at [44]) that ‘being a litigant in person with no previous experience of legal proceedings is not a good reason for failing to comply with the rules’; HMRC’s appealable decisions generally include a statement of the relevant appeal rights in reasonably plain English and it is not a complicated process to notify an appeal to the FTT, even for a litigant in person.”

On 30 July 2025 the Upper Tribunal released its decision in Medpro Healthcare Ltd v HMRC [2025] UKUT 255 (TCC); [2025] STC 1343 (“Medpro”). In Medpro the Upper Tribunal approved the three stage approach in [44] of Martland. However, Marcus Smith J (exercising his casting vote) indicated that no “ex ante weight” should be given to the factors that paragraphs [43] and [45] of Martland had stated were of “particular importance”: namely (i) the need for litigation to be conducted efficiently and at proportionate cost; (ii) for statutory time limits to be respected; and (iii) to enforce compliance with rules, practice directions and orders.

Therefore, the only change in approach required by reason of Medpro is that it is for this Tribunal itself to attach the weight which it considers is appropriate to each of the relevant factors, rather than requiring the First-tier Tribunal to allocate particular or “extra” weight to Factors (i), (ii) and (iii) ex ante. Importantly, Medpro has not held those factors to be unimportant, or necessarily to carry less weight than other factors. What Medpro requires is for the First-tier Tribunal to make its own mind up about the weight they should bear in each case.

On 17 September 2025 a differently constituted Upper Tribunal released its decision in Pawar v HMRC [2025] UKUT 309 (TCC); [2025] STC 1638 (“Pawar”). In Pawar the Upper Tribunal noted the conflict between Martland and Medpro, and stated (at [93]) they were “unable to conclude that either decision is clearly wrong or, conversely, clearly right”. In those circumstances the Upper Tribunal decided to follow Medpro as it was “the more recent decision and expressly considers the correctness of the earlier decision”.

On 9 October 2025 the First-tier Tribunal (comprised of the SPT (Dingermans LJ), Judge Snelders and Mr Shearer released their decision in Lands Luo Ltd v HMRC [2025] UKFTT 1207 (TC) (“Lands Luo”). In that case the FTT preferred the approach in Martland as it was “consistent with the approach of the Court of Appeal in BPP Holdings (Footnote: ²) which was affirmed, or permitted, by the Supreme Court” (at [71]).

Whilst I find the reasoning in Lands Luo attractive, the parties are agreed that I am bound by Medpro. I agree with the parties on this. Accordingly, I set out my decision by reference to the Medpro test. I then make alternative findings based on the Martland test, as I understand Medpro is subject to appeal.

I heard from Mr Kevin Curry, General Counsel at SIL and Mr Paul Wilson, an Indirect Tax Partner at Grant Thornton UK LLP (“GT”).

I found both to be honest witnesses who sought to assist the Tribunal. However, neither was a particularly helpful witness as they both lacked first-hand knowledge of important parts of their case.

The case was heard on 6 June 2025. On 15 July 2025 an embargoed draft of this decision was released to the parties. Comments were received from the parties on 24 July, but before the decision was released, Medpro was released. Shortly after, Pawar and Lands Luo were released. Submissions from the parties were invited in respect of these cases, which have been taken into account in redrafting this decision.

I make the following initial findings of fact. I then make further findings of fact when considering each limb of the test in Martland.

On 21 December 2018, GT submitted an Error Correction Notice on SIL’s behalf (the “First Claim”) claiming overpaid output tax on sales of e-cigarettes and vaping products for quarterly VAT periods 12/14-09/18. The amount claimed was £7,091,773. The basis for the claim was that the supplies were properly subject to the reduced rate of VAT under Item 1. The letter from GT attached form “64-8” authorising GT as SIL’s agent for its VAT matters and concluded:

“should you have any questions please contact me using the details provided. We have attached a signed 64-8 form at Appendix B”.

On 20 May 2019, GT contacted HMRC seeking an update on its claim. HMRC claimed to have not received the letter, but GT subsequently provided evidence that its letter was sent by recorded delivery and signed for by a member of HMRC on 24 December 2019. The letter was subsequently resent to HMRC.

On 15 July 2019, HMRC refused the claim and SIL lodged an appeal against HMRC’s decision on 15 August 2019 (the “First Appeal”).

On 25 August 2020, the First Appeal was stayed behind the appeal of Pillbox 38 Limited (“Pillbox”), which was designated the lead case concerning the correct VAT treatment of e-cigarettes and vaping products. The First Appeal was lodged one day late. Reasons were provided for the short delay, which included that the decision had only been received on 22 July 2019. HMRC did not object to the late lodging of the First Appeal.

On 28 December 2022, SIL made a further claim of £23,476,076 in respect to VAT quarterly periods 12/18 to 09/22 (the “Second Claim”), which is the subject of this application. It was anticipated that the Second Claim would be refused and SIL wished to file an appeal to protect its position pending the Tribunal’s determination of the First Appeal.

On 6 March 2023, the Tribunal confirmed that Pillbox had withdrawn its appeal, prompting discussions between GT and other legal representatives as to the selection of a new lead case.

On 23 June 2023, HMRC refused SIL’s Second Claim. SIL received a copy of the decision. The letter to SIL (the “SIL Letter”) is four sides of A4, although the fourth side is largely blank. The first page of the letter and first two paragraphs of the second side explain why HMRC is refusing the claim. The following section of the letter is headed “What to do if you disagree”, explaining that it is possible to (i) request a review; or (ii) appeal to the Tribunal. The letter explains that either option must be pursued within 30 days of the date of the letter. On page three the final section says:

“Dealing with a tax agent

If you have a tax agent or accountant, please show them this letter.

If you contact us, we can deal with you more quickly if you quote the VAT registration number [*** **** **] and give us your contact details.”

[my redaction]

HMRC say a copy of this letter was sent to GT (the “GT Letter”). The only evidence we have to support this is the email of Officer Kimmi Owosho to GT, dated 13 March 2024, which says that letters were both sent to SIL and GT and enclosing copies.

Mr Wilson’s evidence is that no such letter was received by GT. His witness statement gives a thorough and detailed account of the processes involved in the mail room at GT’s Manchester offices. I accept that if such a letter had been received then there would have been a record – either with the mail room or in the email of relevant GT team members (to whom post is scanned for delivery). Mr Wilson’s evidence is that there are also occasions when GT has not received post from HMRC, including:

I accept that the GT Letter was not received. I find it difficult to conclude whether (i) the GT Letter was sent by HMRC and lost in the post; or (ii) was simply not posted. We have no similar evidence from HMRC in relation to the operation of their mailroom and how letters are sent. This was clearly an issue that was in dispute in the appeal. In light of the examples given at (2) and (3) above I am prepared to accept that the GT Letter was not sent by HMRC. However, the SIL Letter was received by SIL.

The SIL Letter was received by SIL’s Financial Controller, who was dealing with the claim. Mr Curry says that SIL did not act because they expected HMRC would communicate directly with GT and SIL were not familiar or experienced with the process of submitting error correction notices and appealing to the Tribunal. He says in his witness statement that:

“SIL’s expectation, given that the second claim submitted was of exactly the same nature as the first but for a later period, was that the second claim would naturally follow the same process. Supreme Imports Limited did not appreciate that a second notice of appeal would have to be lodged as the same issues had already been covered in the first notice of appeal.”

It is unclear what is meant by that. Given that the refusal of the First Claim was appealed there would be no reason why, likewise, the Second Claim should not need to be appealed. All the more so as the SIL Letter expressly stated this.

Mr Curry explained in evidence that he was not employed by SIL at this time, but had spoken to the relevant employees. While I accept Mr Curry was doing his best to assist the Tribunal, such hearsay evidence carries less weight, especially because the Tribunal is therefore deprived of the ability of testing it under cross-examination. I therefore approach this evidence with some caution.

Although the GT Letter was not received, the SIL Letter was received. Accordingly it was validly served. This is because a notice is validly served by posting it to a “person or his VAT representative” [my emphasis]: s 98 VATA 1994.

On 23 July 2023, the time for appealing expired under s 83G(1)(a)(i) VATA 1994, being the relevant statutory provision.

On 3 October 2023, GT sent an email to HMRC confirming the assignment team members who would be assisting with the various vaping claims that GT was instructed on (not just SIL’s). On the same day, the HMRC Officer telephoned GT to confirm the receipt of the top-up claim submitted by the lead appellant. Mr Wilson’s witness statement says:

“45.

To the best of our knowledge, the understanding of the assignment team member on the call was that [the lead case] was discussed, and the other live claims were mentioned too, including that of the Appellant. The assignment team member recalls mentioning that the Second Claim had been submitted and Grant Thornton was still waiting to hear from HMRC in this regard. It was consistent with HMRC delays including the time taken to deal with the first claim that the Second Claim would not have been dealt with by this time, particularly as the HMRC Officer did not mention that a decision letter had been issued for our client.

46.

As a result, Grant Thornton did not take any further action to follow up the letter of decision at that time.”

On the day of the hearing we were provided with a chain of emails relating to this call. On 3 October 2023 at 11:29 Officer Owosho emailed MF at GT in relation to error correction notices from [the lead case]. At 11:56 there is a further email from Officer Owosho, again relating to the error correction notices from [the lead case]. On the following day at 10:12 MF emails Mr Wilson, in an email headed “RE: VAT Query: [the lead case]”, saying:

“Just to give some more context to the note from HMRC below, shortly after we sent the initial response which described the timeline and had the submission(s) attached, the officer called me.

Key points discussed,

• The officer confirmed he found the ECN in the attachment and as such there was no need to resend it.

• He asked to confirm that Grant Thornton are agents for [another taxpayer] and Supreme Imports Ltd.

• Continuing this, I confirmed that for [another taxpayer] and SIL, we have submitted top-up ECN’s and Notices of Appeal in July 23 and December 22, respectively.

• Finally, we could expect a formal decision from HMRC towards the end of the week, beginning of next.” [my redaction]

I note the contents of the email are not fully accurate. It suggests that notices of appeal were submitted in respect of SIL – it is accepted that no notice of appeal was submitted in December 2022: that was when the Second Claim was submitted, but not a notice of appeal. For this reason I approach this email with some caution. I note also that the heading and the emails with HMRC do not relate to SIL. I note also that it does not mention that GT were awaiting receipt of a decision letter.

On 12 March 2024, GT contacted HMRC requesting an update on SIL’s Second Claim.

On 13 March 2024, HMRC responded stating that the decision had been posted to SIL and GT on 23 June 2023, and attached copies of these letters.

On 22 March 2024, SIL filed a notice of appeal against HMRC’s decision dated 23 June 2023 (the “Second Appeal”). Accordingly the notice of appeal was filed 273 days after the relevant decision. The original application asserted that neither SIL nor GT had received a copy of HMRC’s decision. However, SIL subsequently located a copy of the decision letter, and GT asked the Tribunal to disregard the earlier appeal that had been lodged. An amended application was filed on 5 April 2024 clarifying the position.

SIL also applied to stay the appeal behind the lead appeal, noting that discussions with HMRC as to the selection of a new lead case were ongoing.

On 12 April 2024,a new lead case was selected. HMRC served its statement of case on 29 October 2024.

The delay in making the Appeal was just short of eight months.

HMRC rely on the decision in Romasave (Property Services) Limited v HMRC [2015] UKUT 254 (TCC); [2016] STC 1 (“Romasave”) at [96] where Judges Berner and Falk held, at [96] “a delay of more than three months cannot be described as anything but serious and significant”, in the context of an appeal right which must be exercised within 30 days.

However, as SIL observed, in the very next sentence, the Upper Tribunal emphasised that “each case must be considered in its own context”. They say that in the circumstances of this case, a delay of eight months was not serious and significant considering:

I consider that I am bound to find that these factors relied on by SIL carry little weight. In Romasave at [100]-[102] Judges Berner and Falk held:

“100.

We have considered whether the fact that Romasave will, according to our decision on the other issues in this appeal, be able to pursue its appeals against Decisions 2 – 6 and 8, is a material factor in determining whether an appeal should be permitted in relation to Decision 9. Whilst to add such an appeal to those otherwise able to proceed would not involve much, if any, additional time and expense in conducting the proceedings, the time and expense of such proceedings was not a factor to which we consider any particular weight should be given in the circumstances of this case. In principle, it seems to us that the question whether permission should be granted should be determined independently of the position on other appeals and that they are of limited, if any, relevance. If a clear conclusion is reached that it is not appropriate to grant permission to bring a particular appeal on its own merits, taking account of all the circumstances relating to that appeal, we do not think it right that the result should change solely because, as a result of our decision on the other appeals, it could conveniently be heard with them. The existence or otherwise of related appeals ought not to be a material factor. If it were, then the question whether an appeal that would otherwise not be permitted to proceed could be allowed to do so could turn on the happenstance that, at the time the application is considered, there are appeals to which it might be joined. That would be capable of operating unfairly as between taxpayers in otherwise identical situations, some of whom have concurrent appeals and others of whom do not.

101.

The position can also be tested this way: if we were wrong on this point then, even if the FTT judge had applied the correct test and reached an otherwise unassailable decision on this point to refuse permission, that decision could be overturned on appeal simply by virtue of the outcome of appeals in relation to the other Decisions, since the FTT judge would have made an error of law in failing to recognise that the other appeals could proceed. The same process could continue if our own decision was appealed, and the outcome would logically also change if Romasave withdrew its appeals in relation to the other Decisions (which it could choose to do at any time). Effectively, the parties’ own actions on other appeals, well after the time when the delay in appealing occurred, could continue to affect the decision whether to grant permission.

102.

Overall, we do not consider, therefore, that the fact that there are other appeals by Romasave on the same issue should outweigh the prejudice to the finality of litigation in respect of the particular Decision in question that arises when, for no good reason, Romasave was guilty of such a significant and serious delay in making its appeal in that respect.”

This was considered again by the Upper Tribunal in HMRC v Websons (8) Ltd [2020] UKUT 154 (TCC) (“Websons”) at [49] where Judges Herrington and Andrew Scott referred to Romasave and Kimathi v Foreign and Commonwealth Office [2017] EWHC 939 (QB) holding:

“In our view, it is apparent from these authorities that the weight to be placed by the tribunal on the need to give particular importance to the need for litigation to be conducted efficiently and at proportionate cost is not to be diminished simply because, in the case of mass litigation, the appeal could be conveniently heard with other cases or because the addition of the claim would not affect the trial timetable for any lead case.”

In Websons the Upper Tribunal refers to the “particular importance” of “the need for litigation to be conducted efficiently and at proportionate cost”. Following, Medpro I accept there is no ex ante weight attached to any factor. That does not alter the principle, because the reasoning was not influenced by the ex ante weight. Rather, in Websons the Upper Tribunal quotes Romasave where it says:

“The existence or otherwise of related appeals ought not to be a material factor. If it were, then the question whether an appeal that would otherwise not be permitted to proceed could be allowed to do so could turn on the happenstance that, at the time the application is considered, there are appeals to which it might be joined. That would be capable of operating unfairly as between taxpayers in otherwise identical situations, some of whom have concurrent appeals and others of whom do not.”

In their further submissions SIL say that:

“a.

In Romasave at §100, the Upper Tribunal hold that:

‘if a clear conclusion is reached that it is not appropriate to grant permission to bring a particular appeal on its own merits, taking account of all the circumstances relating to that appeal, we do not think that the result should change solely because… it could conveniently be heard with [other appeals]’.

However, the Appellant is not arguing that the FTT should allow the appeal to proceed solely because it could be heard with the Appellant’s extant appeal (which is itself stood behind other appeals). It is one of a number of factors that weigh in favour of allowing the appeal to proceed.

b.

The quotation from Websons at §49 is made in the context of the Upper Tribunal erroneously thinking that particular weight needed to be placed on the need for litigation to be conducted efficiently and at proportionate cost. We now know that to be incorrect.”

However I do not accept that analysis. Viewed in context, in Romasave the Upper Tribunal is saying that the existence of other appeals is not a material factor: therefore in any case the presence/absence of other appeals cannot tip the balance in favour or against granting permission. I have already explained how the analysis in Websons does not rely on placing particular weight on certain factors. This follows Romasave where they adopt a principled approach (“In principle…”) that disregards the “happenstance” of other appeals to tip the balance in “otherwise identical situations” as it would be “unfair”.

SIL seeks to rely on Mateola v HMRC [2019] UKFTT 179 (TC) (“Mateola”), where it was held that where a taxpayer made a valid appeal against an earlier assessment, that is a factor in favour of allowing them to appeal against the later assessment, given that the two appeals will be based on precisely the same issues. That is a decision of the FTT. I am bound to follow the decisions of the Upper Tribunal.

Considering all the factors of the case I find the delay to be both serious and significant. The delay was just short of eight months. The factors cited by SIL do not significantly mitigate this. HMRC was legitimately entitled to assume the matter was closed.

SIL say that there were good reasons for the delay and both GT and SIL have acted reasonably throughout. They say it was reasonable of SIL to take no action upon receipt of the SIL Letter since:

HMRC say that it was not reasonable for SIL to ignore the letter they received. No prudent taxpayer would ignore a letter without considering its contents and its importance. The letter was addressed to SIL, it was not an agent copy. The unreasonableness of ignoring the letter was increased after not hearing from GT within a 30 day period for action stated in the letter. SIL’s second reason seeks also to ignore the fact they received the letter. HMRC say that a mistake on the part of representatives is not a good reason for delay: MPTL Limited v HMRC [2022] UKFTT 472 (TC). Further the Upper Tribunal has affirmed in HMRC v Hafeez Katib [2019] 189 UKUT (TCC) at [56] that “failures by a litigant’s adviser should generally be treated as failures by the litigant”.

I find the case law cited immediately above by HMRC is not on point. There are no failures by GT. Nor is there a mistake on their part. I accept that they cannot be expected to have chased HMRC within this period. HMRC can take a significant time to deal with matters. Mr Wilson noted this time can be longer when a repayment is in issue.

I accept that GT had not received the letter (see above at [24]). I accept that if GT had received the letter they would have promptly acted on it. While HMRC may be responsible for not posting the letter – and so in a “but for” sense be a cause of the non-compliance – the real cause of the non-compliance is that SIL ignored the plain wording of the letter they did receive, telling them they had 30 days to appeal.

I do not consider SIL’s reasons for ignoring the letter they received to be a good reason. I find the reasoning at [48](3) to be flawed. If they needed to file a notice of appeal for the First Claim they should have understood it was necessary for the Second Claim. I do not consider the reliance on GT is a good reason in light of the clear wording of the letter that SIL received (see above at [21]). They should have followed up with GT immediately on receipt of the letter and, certainly, if they did not hear from GT as the 30 day deadline approached. This is all the more so due to the size of the claim.

I recall in Martland, at [47], Judges Berner and Poole commented:

“Shortage of funds (and consequent inability to instruct a professional adviser) should not, of itself, generally carry any weight in the FTT’s consideration of the reasonableness of the applicant’s explanation of the delay: see the comments of Moore-Bick LJ in Hysaj referred to at [15(2)] above. Nor should the fact that the applicant is self-represented-Moore-Bick LJ went on to say (at [44]) that ‘being a litigant in person with no previous experience of legal proceedings is not a good reason for failing to comply with the rules’; HMRC’s appealable decisions generally include a statement of the relevant appeal rights in reasonably plain English and it is not a complicated process to notify an appeal to the FTT, even for a litigant in person.”

I consider here the letter SIL received clearly explained the position. It was received by the financial controller: the person in the company with conduct of the matter, who would have understood the significance of the claim. SIL chose not to call the financial controller as a witness.

There is no good reason why SIL did not act on the letter, making an appeal within the 30 day time limit, given the clear explanation in the letter.

SIL says that the appeal should be allowed to proceed in light of the following circumstances:

I find myself in general agreement with HMRC’s position on these points. Following SIL’s numbering:

I start by noting the statement in Martland that my starting point is that permission should not be granted unless I am satisfied on balance that it should be.

Standing back, I note that there has been a delay of almost 8 months. While I accept there was failure on behalf of HMRC by not sending the GT letter, but for which failure the delay would not have occurred, I have found that there was no good reason for the delay, for the reasons I set out above at [48]-[55].

As regards all the other circumstances, which I have discussed above, whilst conscious of the significant amount in dispute, I find that they are not such as to persuade me that the merits of the reason given for the delay and the prejudice which would be caused to SIL outweigh the prejudice to HMRC.

I therefore refuse the application.

Having regard to all the evidence in the round, I would also refuse the application if I were to apply the Martland test and ex ante assign special weight to (i) the need for litigation to be conducted efficiently and at proportionate cost; (ii) for statutory time limits to be respected; and (iii) to enforce compliance with rules, practice directions and orders.

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.