Harbron Recruit Limited v The Commissioners for HMRC
Decision date: 9 January 2025
Neutral citation: [2025] UKFTT 23 (TC)
Overall AI summary confidence: high
Short overview
This short overview is intended to summarise the case, issues and outcome so far as they are supported by the judgment.
AI confidence in this short overview: high
Harbron Recruit Limited (HRL) appealed HMRC’s refusal to relieve it from deemed CIS under‑deductions after HRL, on professional advice, submitted nil CIS returns following agency rule changes. The First‑tier Tribunal found HRL had taken reasonable care, that Mr Harbron genuinely believed the course taken was correct, and rejected HMRC’s attempt to revisit Condition A once the Tribunal had decided it. The Tribunal directed HMRC under Reg 9(5) to reduce the under‑deduction to nil for the amounts under appeal.
Ratio decidendi
This summary is intended to identify the ratio decidendi, meaning the legal reasons for deciding and the binding part of the decision.
AI confidence in this ratio decidendi summary: medium
The Tribunal treated Regulation 9 as a single, integrated appeal process and held that a taxpayer meets Condition A where, faced with a technically complex statutory interaction, the taxpayer reasonably relies on appropriate specialist professional advice and competent internal decision‑making; once the Tribunal determines Condition A in the taxpayer’s favour, HMRC may not reopen those same Condition A matters.
Obiter dicta
This summary is intended to identify obiter dicta, meaning observations made by the way that were not necessary to deciding the case and are not binding.
AI confidence in this obiter dicta summary: medium
The judgment observed (non‑bindingly) that in complex situations ignorance of the law may, for a particular taxpayer, constitute an objectively reasonable position and that the maxim “ignorance of the law is no excuse” is not absolute. It also noted issues about Condition B’s drafting and that Reg 9 contains no tribunal appeal against HMRC refusal on Condition B.