Backlog of tax disputes has risen for three years in a row

The backlog of appeals at the First-tier Tribunal hit 28,800 in 2017-18, up from 25,520 in 2016-17, and more than double the 13,460 outstanding in 2009-10. 

Pinsent Masons considers this has been caused in part by HMRC’s litigation and settlement strategy which makes it hard for individual teams to make out-of-court settlements. This is despite the framework being updated to make it easier to settle with taxpayers.  

There have also been more judicial review challenges by taxpayers to accelerated payment notices (APNs). HMRC has withdrawn more than 6,000 APNs since 2014.

Steven Porter, partner at Pinsent Masons, said: ‘HMRC’s inflexible approach to dealing with disputes is exacerbating the growing backlog at tax tribunals.’

He added that the litigation and settlement strategy framework forces HMRC to take an unrelenting approach and ‘recent updates to the framework may not have gone far enough in enabling HMRC to settle with taxpayers’.