Taxpayer is entitled to reasonable costs

The taxpayer had appealed against a partial closure notice which included a tax charge of about £900 000. The appeal was allocated to the complex category and the taxpayer did not opt out of the costs regime. The First-tier Tribunal described the litigation as ‘ill tempered’ and ended in HMRC notifying the tribunal that it would no longer oppose the appeal. As a result the tribunal allowed the appeal. The taxpayer then applied for costs of more than £350 000 assessed on the indemnity basis.

HMRC applied to have the claim struck out on the basis that the schedule of costs did not contain enough detail but the tribunal refused.

The taxpayer’s advisers had provided a schedule of costs for the tribunal to make a summary assessment. However the First-tier Tribunal found the schedule was deficient in the way it particularised the tasks carried out by...