Haron Mayet v The Commissioners for HMRC

Permission to appeal from the First-tier Tribunal is granted only where the proposed appeal has a realistic prospect of success on a point of law, or there is another compelling reason. Case-management decisions about hearing format attract a high threshold of appellate intervention. A tribunal may determine an appeal on the papers where the parties consent and it considers that it can fairly decide the matter without a hearing. Practical burdens may be relevant to that assessment, provided fairness and participation are also considered.

An inquisitorial duty in the Tax Chamber is flexible and fact-sensitive. A deliberate inaccuracy requires an intention to mislead, or a non-fanciful suspicion of inaccuracy deliberately ignored. Objective constructive knowledge alone is insufficient, but an erroneous observation will not justify permission where the tribunal also made sufficient findings of actual knowledge or blind-eye conduct.

Haron Mayet applied to the Upper Tribunal for permission to appeal against the First-tier Tribunal’s decision of 16 January 2025, which dismissed his appeals against discovery assessments and penalties imposed by HMRC concerning undeclared property-management and interest income.

The First-tier Tribunal had determined the appeal on the papers after concluding that a video hearing was impracticable and a telephone hearing would not be in the interests of justice. The proposed grounds alleged procedural unfairness, failure to adopt an inquisitorial approach, misdirection on deliberate inaccuracy, and inadequate reasons for the penalty calculations.

The Upper Tribunal reconsidered permission following an oral hearing and addressed whether any ground disclosed an arguable material error of law or another compelling reason.

1. Permission test. An appeal from the First-tier Tribunal lies only on a point of law. Permission requires a realistic prospect of success, rather than a fanciful one, or exceptionally another good reason: Smith v Cosworth Casting Processes Ltd [1997] 1 WLR 1538.
2. Hearing format and procedural fairness. The decision to determine the appeal on the papers was a case-management decision. Appellate intervention is justified only where the tribunal misdirected itself, ignored relevant matters, considered irrelevant matters, or acted plainly outside the generous ambit of reasonable decision-making: Broughton v Kop Football (Cayman) Limited and others [2012] EWCA Civ 1743 at [51]. Rules 29 and 2 of the FTT Rules 2009 permitted the paper determination because the Applicant had consented to it and the FTT was entitled to consider that it could decide the matter fairly without a hearing. Practical factors, including proportionality, complexity, administrative difficulty and delay, could be considered alongside participation and fairness.
3. Inquisitorial role. The extent of the FTT’s inquisitorial duty varies with the circumstances, including the characteristics of the litigant and the complexity of the case. It remains a matter of procedural discretion directed by fairness. The written questions, answers and documentary review provided a reasonable and proportionate procedure in this case. The flexibility of tribunal procedure recognised in Volkswagen Financial Services (UK) Ltd v Commissioners for Her Majesty’s Revenue and Customs [2017] UKSC 26 at [7] did not require a different result.
4. Deliberate inaccuracy. The applicable test, stated in HMRC v Tooth [2021] UKSC 17 at [47], requires an intention to mislead HMRC as to the truth of the relevant statement, or potentially recklessness of the relevant kind. CPR Commercials Ltd v HMRC [2023] UKUT 61 (TCC) explains that deliberately failing, without good reason, to confirm the true position where there is a more-than-fanciful suspicion may amount to deliberate inaccuracy.
5. The FTT’s reference to what should have been obvious could not alone establish deliberate conduct because it reflected objective constructive knowledge. However, the FTT also expressly found actual knowledge and blind-eye conduct, supported by its findings about undeclared income, incomplete records and misleading explanations. Any error was therefore not material. The challenge to those factual findings also failed to meet the high threshold applicable to an Edwards v Bairstow challenge.
6. Penalty reasons. Reading the FTT’s reasoning as a whole, it was sufficiently clear that it would uphold penalties at 192.5 per cent of potential lost revenue, while declining to increase lower penalties where the basis for their lower percentage was unclear.
7. Permission to appeal was refused on all grounds. There was no realistic prospect of success and no other compelling reason to grant permission.

• Upper Tribunal (Tax and Chancery Chamber): permission to appeal refused on 4 November 2025.
• First-tier Tribunal (Tax Chamber): appeal against HMRC’s discovery assessments and penalties dismissed on 16 January 2025. Permission to appeal was refused on 27 March 2025.