VAT & Late Appeals

The First-tier Tribunal has granted permission to bring three late appeals in the case of East Midlands Waste Management Ltd (EMWM), in a decision that focuses entirely on procedural grounds rather than the merits of the underlying tax dispute.

HMRC issued two VAT penalty assessments and one VAT assessment against EMWM during 2023, arising from a complex investigation into the company's VAT, corporation tax, and employment tax affairs. The combined value of the three decisions exceeded £535,000.

The company's long-standing accountants ceased to act in August 2023, and a new firm was appointed shortly after. The incoming adviser made contact with HMRC's case officer in October 2023 and sought to understand the position following the handover - a process complicated by the breadth of the ongoing investigation. HMRC acknowledged at the time that the case was by no means straightforward.

By the time the new advisers were fully engaged, the 30-day appeal windows for all three decisions had already closed. HMRC had explicitly warned the new advisers of this during correspondence and at a meeting in December 2023. The appeals were therefore brought out of time, requiring the Tribunal's permission to proceed.

The Tribunal considered the application against the established framework for admitting late appeals, drawing on the principles set out in the Martland and Medpro Healthcare cases. These require the Tribunal to assess factors including the length of the delay, the reasons for it, the strength of the underlying case, and any prejudice to HMRC.

Permission was granted for all three appeals. The decision reflects the Tribunal's recognition of the disruption that a mid-investigation change of adviser can cause, particularly where the underlying inquiry is genuinely complex. The judge also noted that the hearing bundle itself was difficult to follow - an observation that speaks to the practical challenges the incoming advisers faced.

What this means in practice

The decision is a useful illustration of how the Tribunal approaches late appeal applications where there is a legitimate explanation for the delay. A change of professional representation, in isolation, will not automatically excuse a late filing. The circumstances here - an active and complex multi-tax investigation, an abrupt handover, and a new adviser working to establish the position from scratch - provided the context that justified the Tribunal's intervention.

For advisers taking on clients in dispute with HMRC, the case reinforces the importance of identifying appeal deadlines as a first priority, even where the substantive issues are unresolved. Where deadlines have already passed, an application to admit a late appeal remains available, but the outcome will depend on the specific facts.

VITA assists businesses and their advisers in managing HMRC disputes, including time-critical procedural matters.

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