Biffa Waste Services Ltd, R (On the Application Of) v Revenue And Customs

A legitimate expectation may arise from a tax ruling where the taxpayer has disclosed the relevant facts and the ruling is clear, unambiguous and free from relevant qualification. Its scope is determined by the ruling’s language and the full factual and legal context, including what was reasonably and fairly implicit in the representation. A ruling given in relation to one site may extend to materially identical operations elsewhere where the tax analysis depends on the nature and use of the operation rather than site-specific features. A public authority may not retrospectively adopt an interpretation of its representation that is wholly inconsistent with the meaning and effect intended when the representation was made.

Biffa operated landfill sites and relied on a ruling by HMRC dated 28 September 2009 that material used in a regulation layer beneath a landfill cap was outside the scope of landfill tax. HMRC later withdrew that ruling and directed Biffa to account for tax retrospectively on regulation-layer material used after 1 September 2009. Biffa sought judicial review of that decision, while the underlying tax liability remained for determination by the First-tier Tribunal. The central issues were the scope and meaning of the ruling and whether Biffa had disclosed all material facts and matters before it was made.

1. Claim allowed. HMRC accepted that the claim succeeded if the ruling applied beyond the North Herts site, covered the material used in the regulation layer, and was not defeated by material non-disclosure.
2. The meaning and scope of a public authority’s representation are assessed in the full factual and legal context. The question is what the representation would reasonably and fairly have conveyed to those to whom it was made. The ruling therefore had to be read with the information supplied by Biffa, HMRC’s knowledge of Biffa’s operations, and the legislative background.
3. The ruling was not site-specific. Although made in the context of North Herts, the tax analysis turned on the nature and function of the regulation layer, not on characteristics unique to that site. It therefore extended to materially equivalent regulation layers at Biffa’s other sites.
4. The ruling was not confined to soil. It focused on the use to which the material was put, consistently with Waste Recycling Group v HMRC [2008] EWCA Civ 849. Nothing in the ruling or contemporary documents required soil, and soil only, to be used.
5. The words concerning Biffa having no intention to discard the material explained the basis of the ruling and did not impose a separate operative condition. The ruling was clear, unambiguous and free from relevant qualification.
6. Biffa had not materially failed to disclose relevant facts. The alleged later application of the ruling to the separate EVP layer was not shown to have been contemplated when the ruling was made, and the ruling did not directly determine the EVP layer’s tax treatment. The question of that layer remained for the First-tier Tribunal.
7. The court also observed, obiter, that it would be unlawful and offensive to justice for a public authority to advance an interpretation of a representation wholly inconsistent with the effect intended by it when the representation was made.