Supreme Court judgment in Tinkler v HMRC [2021] UKSC 39

On 30 July 2021, the Supreme Court handed down judgment in the case of Tinkler v HMRC, which relates to the law of estoppel by convention. Nicholas Macklam acted for the successful appellant (HMRC), led by Malcolm Gammie CBE QC (One Essex Court) and Michael Jones QC (Gray’s Inn Tax Chambers).

This is the first occasion the highest court (House of Lords or Supreme Court) has considered the law of estoppel by convention in detail.

The appeal arose out of a notice of enquiry sent by HMRC to the Respondent to the wrong address. HMRC subsequently issued a Closure Notice purporting to amend a certain tax return of the Respondent and disallow certain losses claimed. The Respondent disputed this and the question of whether a valid notice of enquiry had been served was heard as a preliminary issue. HMRC contended that its sending of a copy of the notice to the Respondent’s accountants established a mistaken assumption, shared by the parties, that a valid tax enquiry had nevertheless been opened into one of Respondent’s tax returns and the Respondent was therefore prevented by law from denying that there was a valid notice.

The Supreme Court unanimously allowed HMRC’s appeal against the judgment of the Court of Appeal, and held that the Respondent was estopped from denying that a valid enquiry had been opened into the tax return.

Lord Burrows gave the lead judgment, with which Lord Hodge, Lady Arden and Lady Rose agreed. Lord Briggs gave a short concurring judgment explaining why he agreed with the reasoning of Lord Burrows.

A copy of the judgment is available here.