HM Revenue and Customs Brief 10/09
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Issued 16 March 2009
Tribunals Reform – Changes to the tax appeals system and new
internal review process
Revenue & Customs Brief outlines the new tax appeals system and
HMRC’s new internal review process, due to be implemented from 1 April
From 1 April 2009 there will be a
major change to the current system of tax tribunals. To coincide with
this, HMRC is changing the way it handles disagreements about tax. The
new review process will help provide a more consistent approach to the
way we seek to resolve disputes with those who disagree with appealable
tax decisions made by HMRC.
At the moment, there are three main
tribunals which deal with appeals against HMRC decisions. From April,
these tribunals will be abolished and replaced by a single Tax Chamber
in the First-tier Tribunal which will consider all disputes and hear
appeals in relation to both direct and indirect tax.
Tribunals, Courts and Enforcement Act 2007 introduced two new bodies,
the First-tier Tribunal and the Upper Tribunal. Over time most existing
tribunal jurisdictions including the tax tribunals will be transferring
into the new bodies. The new system went live on 3 November 2008. These
new statutory bodies are administered by the Tribunals Service which is
part of the Ministry of Justice.
Both First-tier and Upper
Tribunals are divided into 'chambers' where similar types of appeal are
heard. On 3 November when appeals formerly heard by the Social Security
Appeals Tribunal successfully transferred to the First-tier Social
Tax appeals will transfer to a new
First-tier Chamber, to be known as the Tax Chamber, on 1 April. A right
of appeal against decisions of the First-tier Tax Chamber will also be
created to a new chamber in the Upper Tribunal to be known as the
Finance and Tax Chamber.
The First-tier Tribunal will deal with
the vast majority of appeals, apart from a very small number of the
most complex appeals that will transfer to the Upper Tribunal at first
instance. The Upper Tribunal will mainly deal with appeals against
decisions of the First-tier Tribunal. Work within each tier of the
tribunal will be organised into specialist chambers, one of which will
deal with tax.
The reforms will affect everyone who disagrees
with one of our tax decisions and may wish to have it reviewed, or to
make an appeal. As part of the reforms, the General Commissioners and
Special Commissioners of Income Tax, the Section 706/704 Tribunal and
the VAT & Duties Tribunals will be abolished after 31 March
and their existing functions will transfer into the new First-tier Tax
Some straightforward appeals will in future usually be
dealt with on paper without the need for HMRC or customers to attend a
Where a hearing is needed the Tribunals Service will
arrange this. Most appeals will be heard at one of a national network
of tribunal hearing centres.
with tribunal reform, our customers will be entitled to request an
internal review of appealable tax decisions. This new legal right to a
review will replace reconsiderations and mandatory reviews in indirect
taxes (mandatory reviews will remain for decisions about the
restoration of seized goods).
Reviews will be optional and will
be done by a trained review officer, who has not previously been
involved with that decision, who will be able to offer a balanced and
objective view. In the vast majority of cases the review officer will
be outside the immediate line management chain of the decision maker.
must complete reviews within 45 days (unless another period is agreed
with the customer). If customers do not want a review, or if they do
not agree with the result of the review, they can appeal to the
tribunal for a decision.
You can find out more about tribunals reform and internal
reviews from the
Tribunals Reform Project and more about changes to the tax
tribunals from the Tribunals
About the Author
© Crown Copyright 2009.
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article and has been republished for educational / informational
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Article Published/Sorted/Amended on Scopulus 2009-03-19 10:28:01 in Tax Articles