Arthur v The Commissioners for HMRC

For tax-credit eligibility, ordinary residence is assessed by asking whether residence in the United Kingdom was voluntarily adopted for a settled purpose as part of the regular order of a person’s life. The purpose may be specific and limited, and residence may be ordinary in more than one country. Domicile, a permanent home, foreign links and immigration status are relevant only insofar as they assist the factual inquiry. Later events may be considered if they cast light on the position at the statutory date. An appeal against a tribunal’s residence finding succeeds only for an error of law, including a conclusion unavailable to a properly directed tribunal.

Mrs Arthur sought tax credits as a single claimant for 2011–2012. Under section 3(3)(a) of the Tax Credits Act 2002, a couple may claim jointly where both members are in the United Kingdom, and a person eligible to claim jointly cannot claim individually. The First-tier Tribunal found that Mr Arthur was ordinarily resident in the United Kingdom on 6 April 2011. The Upper Tribunal, in appeal CTC/3869/2014, upheld that decision. Mrs Arthur appealed, arguing that the First-tier Tribunal had applied the wrong legal test, reached a conclusion unavailable on the evidence, and wrongly considered events after the relevant date. The central issue was whether Mr Arthur was ordinarily resident in the United Kingdom on 6 April 2011.

Lord Justice Newey gave the judgment, with which Lord Justice Longmore and Lady Justice Asplin agreed.

1. Disposition. The appeal was dismissed. The First-tier Tribunal was entitled to conclude that Mr Arthur was ordinarily resident in the United Kingdom on 6 April 2011.
2. Ordinary residence. The principles in Levene v Inland Revenue Commissioners [1928] AC 217, Inland Revenue Commissioners v Lysaght [1928] AC 234 and R (Shah) v Barnet LBC [1983] 2 AC 309 establish that ordinary residence involves residence voluntarily adopted for a settled purpose as part of the regular order of life. The purpose may be specific and limited. Residence need only be non-casual and non-uncertain. A person may be ordinarily resident in more than one country, and ordinary residence is distinct from domicile or a permanent home. Immigration status may be relevant but is not determinative.
3. Appellate review and reasons. Under Revenue and Customs Commissioners v Grace [2009] EWCA Civ 1082, an appeal from a residence finding requires an error of law, including a conclusion that no properly instructed judicial decision-maker could reach or reasoning containing bad law bearing on the result. Tribunals need not cite authorities exhaustively. Their reasons are read on the basis that the tribunal knew the relevant law unless the contrary is shown, as explained in Assad v Secretary of State for the Home Department [2017] EWCA Civ 10 and Piglowska v Piglowski [1991] 1 WLR 1360.
4. Later events. The inquiry remains focused on the person’s position at the relevant date. However, later events may cast light on that position by forming part of a continuous story and showing method or system. The First-tier Tribunal was therefore entitled to consider events after 6 April 2011, following Levene.
5. Application. By the relevant date Mr Arthur had lived with his wife and daughter in Runcorn for about six months, worked there, had obtained leave to remain and was on the electoral register. His continuing links with Ghana did not prevent ordinary residence in the United Kingdom. The evidence also supported a settled purpose connected with family life and employment. The First-tier Tribunal’s conclusion was open to it on the materials before it.

1. Court of Appeal (Civil Division). Dismissed the appeal and upheld the conclusion that Mr Arthur was ordinarily resident in the United Kingdom on 6 April 2011: [2017] EWCA Civ 1756.
2. Upper Tribunal (Administrative Appeals Chamber). Judge M. R. Hemingway upheld the First-tier Tribunal’s decision in appeal CTC/3869/2014.
3. First-tier Tribunal. Mrs L. Collopy found that Mr Arthur was ordinarily resident in the United Kingdom on 6 April 2011. The decision notice was issued on 11 April 2014 and the statement of reasons was dated 14 May 2014.