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Builder Neil Martin's recent court victory is unlikely to 'open the floodgates' and lead to hundreds of taxpayers claiming compensation from HMRC for alleged negligence.
That's according to leading tax experts, who nevertheless regard the outcome of the high-profile case to be generally positive for the tax sector.
John Whiting is chairman of the CIOT's management of taxes sub-committee. He said that Mr Martin's successful complaint in the Court of Appeal — which allowed the builder to sue for damages after nearly being bankrupted by HMRC error — is 'an important case because a lot of people feel they have been badly dealt with by HMRC for whatever reason.'
But John was pragmatic about the floods of new compensation claims that have been predicted in some reports of Neil Martin's landmark legal win: 'This does not open the floodgates, but it does offer a crumb of comfort for some people.
'It shows that there is at least some area in which HMRC have a duty of care to taxpayers — although it's not clear where the boundaries are.'
Chris Williams, senior manager at Baker Tilly, believes there will be 'no immediate dire consequences' for HMRC despite 'pressure for them to be more accountable'.
He says: 'I'm sure HMRC will carry on regardless, but it will be interesting to see if anyone takes action against individual offices — although that would be largely futile.
'I think someone will eventually attempt to claim damages from HMRC, but it's hard to tell who. Big businesses won't be badly affected by Revenue errors, and small companies could be so severely damaged that they can't afford to pursue actions.
'It's unjust, but there's no prospect of it being righted.'
He added: 'The problem is that HMRC is seeking more power of recovery, but there is also increasing pressure on the individual taxpayer to be accurate with self-assessment. The playing field appears very slanted as a result'.
