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Procedure.Tax
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M18: Extending and shortening time limits
Power to extend or shorten
“(3)…the Tribunal may by direction--
(a) extend or shorten the time for complying with any rule, practice direction or direction, unless such extension or shortening would conflict with a provision of another enactment setting down a time limit;” (FTT Rules, r.5(3)(a))
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Conflict with enactment setting down time limit within which referral "must" be made
"[30] However, I do not agree. As [the partnership] submits, not only is the view expressed by the Upper Tribunal, which is not supported by any reasoning, obiter and therefore not binding, rule 5(3)(a) and rule 21 are silent as to the existence of any exception. Moreover, if the Upper Tribunal in VK were right it would render the restriction in rule 5(3)(a), “unless such extension … would conflict with the provision of another enactment setting down a time limit” otiose.
[31] It therefore follows that as an extension of time would conflict with a provision of another enactment, namely [TMA 1970] s 12ABZB(5), the Tribunal does not have the power under rule 5(3)(a) to grant an extension of time to make a referral under s 12ABZB(3) with the result that any referral that is not made in time “must not” be admitted." (Anderson v. PWC v. HMRC [2022] UKFTT 457 (TC), Judge Brooks - referral of dispute re partnership shares)
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Apply for an extension in advance
“If HMRC have a difficulty with compliance they should, where possible, make application to the tribunal to be relieved of compliance on the basis of some alternative proposal which should be canvassed with the taxpayer prior to the application. The reasons for non-compliance and the merits of the alternative should be explained. HMRC had no good reason indeed no stated reason at all for their non-compliance.” (BPP Holdings v. HMRC [2016] EWCA Civ 121, §43).
“HMRC’s failure to apply in advance for an extension of time was lamentable; at the very least it was discourteous to the appellant and the tribunal.” (HMRC v. BPP Holdings Ltd [2014] UKUT 496 (TCC), §48).
- Not relief from sanctions approach if made in advance
"[15] I first need to decide whether this is an in-time application for an extension of time. The appellant lodged its notice of appeal with the tribunal on 4 November 2022, the tribunal did not notify HMRC of this until 3 February 2023. The 60-day period for filing a statement of case, prescribed by the rules (and confirmed by the tribunal in its letter of 3 February 2023) therefore started on 3 February 2023 and ran until 4 April 2023. The application to extend time was made on 27 March 2023 i.e. before that deadline expired.
[16] I therefore agree with Ms Brown that the application to extend time is an in-time application and thus this is not a relief from sanctions case. Instead, I should apply rule 2.
[17] In Hallam Estates Jackson LJ at [26] stated:
"26. An application for an extension of the time allowed to take any particular step in litigation is not an application for relief from sanctions, provided that the applicant files his application notice before expiry of the permitted time period. This is the case even if the court deals with that application after the expiry of the relevant period. The Court of Appeal established this principle in Robert v Momentum Services Ltd [2003] EWCA Civ 299; [2003] 1 WLR 1577: see in particular para 33. This still remains the case following the recent civil justice reforms. See Kaneria v Kaneria [2014] EWHC 1165 (Ch) at paras 31 to 34. I agree with those four paragraphs in the judgment of Nugee J".
[18] And in Kaneria at [34]:
"34. I accept this submission. It seems to me that unless and until a higher Court has said that the approach in Roberts is no longer to be followed, I am bound by that decision (i) to regard an in time application for an extension of time as neither an application for relief from sanctions, nor as closely analogous to one, and (ii) to exercise the discretion under that rule by applying the overriding objective rather than the terms of CPR r 3.9"." (Tresserras v. HMRC [2024] UKFTT 538 (TC), Judge Popplewell)
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Examples
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- Extension for SoC granted where HMRC reasonably believed it may not be due yet
"[19] Under rule 2, I must deal with this application fairly and justly. It would not be fair and just to sanction HMRC by preventing them from taking part in this appeal simply because they submitted their statement of case after the original due date. That would be wholly disproportionate to any failure. Indeed, I cannot see that they have failed to do what they are obliged to do.
[20] They took the view that the penalty comprises duty, and thus either a certificate of hardship or payment of the penalty was required to give the tribunal jurisdiction to entertain the appeal. Pending resolution of that issue, their obligation to submit their statement of case by 3 February 2023 should be suspended. This seems to me a reasonable and pragmatic stance." (Tresserras v. HMRC [2024] UKFTT 538 (TC), Judge Popplewell)
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- Short extension for SoC (2 weeks) applied for in advance granted
"[14] The application, of 20 December 2021, for an extension of time, from 14 January 2022 to 31 January 2022, to provide the SOC to the Tribunal and Redevco was made on the grounds that HMRC:
“… experienced unexpected difficulties in transferring the bundle of papers to their counsel. Further attempts to transfer the documents were undertaken on 16 December 2021 but, in view of the counsel’s availability until the end of January, an extension of time is required for the Respondents to obtain advice and assistance from their counsel in relation to this appeal. HMRC’s position is that the Appellant will not suffer any prejudice as the full case management directions have not yet been issued and a hearing date is not yet fixed.”
[15] Redevco opposed the application on the grounds that HMRC had provided “no valid reason” for seeking the extension of time or explained why the remaining time for doing so, to 14 January 2022, was insufficient.
[16] Having regard to all the circumstances, particularly the short extension of time sought, that the SOC has now been provided and that Redevco no longer maintains its objection, I have concluded that the application should be allowed, especially as it was made in advance of the compliance date and, as is clear from Robert v Momentum Service Limited [2003] 1 WLR 1577 at [33], is not an application for relief from sanctions." (Redevco Properties UK 1 Limited v. HMRC [2022] UKFTT 102 (TC), Judge Brooks)
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