Without prejudice

Use of without prejudice material in a statement of case

The application related to two separate appeals made by Mr and Mrs R concerning capital gains tax on the disposal of a property they had jointly owned. The First-tier Tribunal ordered the appeals should heard together.

In brief the taxpayers claimed only or main residence relief on the sale of a property. HMRC disputed their claim but it was persuaded by the taxpayers to enter into the alternative dispute resolution (ADR) process. This were unsuccessful so the taxpayers appealed to the First-tier Tribunal.

At the tribunal the taxpayers said HMRC had used in its statement of case without prejudice material obtained as part of an unsuccessful ADR process. The application was for HMRC to be barred from taking further part in the proceedings on the basis that it had failed to co-operate with the tribunal or to...