Tax analysis: The Upper Tribunal (UT) has held that the First-tier Tax Tribunal (the FTT) made a material error of law in its approach to determining when a trade has ‘begun to be carried on’ by a company for the purposes of qualifying for Enterprise Investment Scheme (EIS) relief under section 179(2)(b) of the Income Tax Act 2007 (ITA 2007). The FTT had identified a set of principles by reference to factors which were of relevance in previous cases and applied those ‘legal’ principles to determine that neither Putney Power Limited (‘Putney’) nor Piston Hearing Services Ltd (‘Piston’) had begun to carry on a trade by the relevant date of 4 April 2018. The UT set aside the FTT’s decision on the basis that the FTT had sought to apply a principles-based test which did not exist as a matter of law. The proper approach requires a multi-factorial evaluation of all of the circumstances in the case at hand. The UT re-made the decision but ultimately reached the same conclusion as the FTT, dismissing the appeals of both Putney and Piston and holding that neither company had commenced trading by the relevant date. The decision is significant because it clarifies that there is no strict legal test for when a trade commences: the question remains highly fact sensitive and will be determined by reference to the particular facts and circumstances of each case. Written by Kate Ison (partner at Macfarlanes LLP) and Victoria Braid (associate at macfarlanes LLP).

Tax analysis: In L-L-O Contracting Ltd and others v HMRC, the Upper Tribunal (UT) dismissed the companies’ appeals against the First-tier Tax Tribunal’s (FTT) decision to dismiss appeals against HMRC’s decision not to allow claims to SDLT overpayment relief. The companies had not claimed multiple dwellings relief (MDR) in their SDLT returns and, having missed the time limit for making the claims, sought to obtain the relief by way of overpayment relief claims under paragraph 34 of Schedule 10 of the Finance Act 2003 (FA 2003).

Financial Services analysis: Arian Financial LLP (the Applicant) referred a decision of the Financial Conduct Authority (FCA) to the Upper Tribunal which conducted a complete re-hearing of the issues underpinning the FCA’s decision to fine the Applicant £744,745, pursuant to s133(5) Financial Services and Markets Act 2000 (FSMA 2000). The Applicant admitted breaches of Principles 2 and 3 of the FCA’s Principles for Businesses but disputed the size of the financial penalty. The Tribunal considered that the FCA had not correctly followed its policy set out in its Decision Procedure and Penalties Manual (DEPP). The Tribunal made findings of fact, considered the five stages for determining the size of penalties at DEPP 6.5A (the Five-Step Framework), and directed the FCA to revise its decision with a determination reducing the financial penalty to £288,962. Of particular note is the Tribunal’s clarification of the meaning of ‘financial benefit’ for Step 1 disgorgement, as well as its guidance for approaching Step 4 multipliers by reference to the ratio between the disgorgement figure and the penal element of the fine. Written by Rowena Wisniewska Sethi, barrister and Isabella Taylor, pupil at 4-5 Gray’s Inn Square.

Pensions and Tax analysis: The ruling by the Upper Tribunal (Tax and Chancery Chamber) concerns the liability to VAT of supplies of services in connection with the provision of self-invested pension schemes (SIPPs) and whether those supplies are VAT exempt as the provision of insurance and reinsurance. The Upper Tribunal dismissed the appeal on the basis that the appellant’s supplies of services in connection with the provision of SIPPs were not insurance transactions. The Tribunal agreed with the respondents that the contributions to the Intelligent Money (IM) SIPP made by a member were not consideration for any supply and that none of the payments represented a premium. Annual fees are paid for the operation of the scheme as set out in the fee schedule but are not paid for the provision of the life and death benefits under the scheme. Accordingly, the fees payable by members of the IM SIPP were not held to be consideration for an exempt insurance transaction. Written by Rowena Wisniewska Sethi, barrister, 4-5 Gray’s Inn Square.

Tax analysis: In Exclusive Promotions Ltd v HMRC [2023] UKUT 269 (TCC), the Upper Tribunal (UT) found that accelerated payment notices (APNs) had been validly issued and the taxpayer had no reasonable excuse for failing to pay them or the associated late-payment penalties.

Law360: The Upper Tribunal (UT) ruled on 20 April 2020 that Bella Figura Ltd (BFL) should be subject to a scheme sanction charge in the amount of £80,000 for an unauthorised loan to an affiliated business. However, it avoided an unauthorised payments charge and unauthorised payments surcharge because HMRC’s assessments of both were out of time and so were set aside.

Tax analysis: In The Executors of Hunt and others v HMRC, the Upper Tribunal (UT) considered the scope of an exclusion to the transactions in securities (TIS) rules, and upheld HMRC’s construction, but disagreed with HMRC’s assertion that the legislation contained drafting errors.

Pensions analysis: On 1 August 2025, the Upper Tribunal (UT) handed down judgment in Pelgrave v The Pensions Regulator [2025] UKUT 00257 (TCC). The case is only the third time the UT has considered the Regulator’s power to issue a Contribution Notice (CN) under section 38 of the Pensions Act 2004 (PeA 2004), and is the first involving an ongoing scheme and employer. The UT decided to increase the sum of the CN from that decided upon by the Regulator’s Determinations Panel, and made comments of general application about (i) the role of the UT when hearing a reference, (ii) the meaning of being ‘party to’ an act in PeA 2004, s 38, (iii) the operation of the ‘material detriment’ test in PeA 2004, s 38A in the context of a continuing employer, and (iv) the assessment of what sum is reasonable to impose by way of liability, including how to take account of benefits received by a Respondent, any tax paid on those benefits, and the passage of time between the relevant events and the UT hearing. Written by Thomas Robinson KC, barrister at Wilberforce Chambers, London.

Standardised directions will often be sent out in statutory appeals before the Upper Tribunal (Immigration and Asylum Chamber). New standard directions require represented Appellants to file and serve a composite bundle following a specific format no later than ten working days before the hearing. Notification that an interpreter is needed must also be made no later than ten working days before the hearing. The new standard directions will be in force for all represented parties from 25 September 2023.

On 20 March 2026, Lady Anna Poole, President of the Administrative Appeals Chamber of the Upper Tribunal confirmed in practice guidance that the Upper Tribunal (Administrative Appeals Chamber) (UTAAC) will cease using only parties’ initials in published decisions in social security and child support cases from 30 March 2026, in a change to its long-standing practice of anonymising parties’ names by default. Instead, parties’ names will be published unless an anonymity order is made under the Tribunal Procedure (Upper Tribunal) Rules 2008, SI 2008/2698, reg 14. The change reinforces the open justice principle. The UT1 application form has been updated to allow appellants to request anonymity or other restrictions to open justice.

In Hippodrome Casino Ltd, the Upper Tribunal (UT) allowed HMRC’s appeal, holding that the taxpayer’s partial exemption override based on floor space did not guarantee a more precise calculation of recoverable VAT than the standard method.

Financial Services analysis: In a preliminary hearing of Mr Burdett’s and Mr Goodchild’s (the Applicants) referrals to the Upper Tribunal (UT) of decision notices (the Notices) issued to them by the Financial Conduct Authority (FCA), the Tribunal made a number of rulings on the Applicants’ and FCA’s procedural applications. The Applicants applied for the Tribunal to direct that there be no publication of the Notices pending the outcome of the substantive hearing (the Privacy Applications). The FCA, meanwhile, applied for the Applicants’ referrals to be case managed and heard together in the substantive hearing (the Joinder Applications) and to amend its statements of case (the Amendment Applications). The Tribunal refused the FCA permission to do so on the basis that allegations not articulated in the ‘matter referred’ to the Tribunal could not subsequently be subsumed into the allegations that had been pleaded in the FCA’s Warning Notice. Written by Rowena Wisniewska Sethi, barrister and Benedict Scantlebury, pupil at 4-5 Gray’s Inn Square.