Pump Court Tax Chat

David Yates KC and Sadiya Choudhury KC take a look a some of the latest employment tax cases and recent changes to employment tax legislation.
Umbrella companies
2:01 Mainpay: Mainpay was an umbrella company providing the services of various employees whose assignments were sourced by an employment agency. The employment point in the case was the nature of the "overarching contract" between Mainpay and the workers, and specifically whether this allowed Mainpay to reimburse travel and subsidence expenses without accounting for income tax and NIC. Consideration of the Readymix Concrete test. Could you argue a "single discontinuous working employment relationship"? Legislation has now made arguing for overarching contracts very difficult (s339A ITPA). Other aspects of this case are discussed in the most recent Tax Litigation Update podcast.
9:20 PPS Umbrella and VAT mini-umbrella fraud category: Elphysic being the lead case which is heading for the Supreme Court. However new legislation is coming in April 2026 which makes umbrella companies jointly and severally liable for NICs. The government is also reviewing the operation of umbrella companies more widely.
SARS
10:39 Saunders: stock appreciation rights (SARS) under a long term incentive plan. NB this case is currently on appeal. When an employee is promised something (like a contractual right) - is it the contractual right which is their earnings or is it the payment made later under it? Does Abbott v Philbin still hold good? Do SARS have a value in their own right? Does the employee derive realistic immediate value?
IR35 legislation
21:51 Bryan Robson Ltd: payments for acting as an ambassador for Manchester United. Was it an employment contract under the hypothetical employment test? Whether all or part of the consideration was attributable to the contract allowing exploitation of image rights and, if so, was this outside IR35? Case is on its way to the UT.
27:50 New offset mechanism in the tax legislation to allow payments to be offset against PAYE liabilities. Will this mean a decrease in IR35 cases?
Payments in lieu of notice
28:53 Rawlinson: was the payment in lieu of notice (PILON) (the employee was disabled due to cancer surgery) subject to income tax as earnings? Guidance on operation of the exception of s401/406 ITPA. Absence of express language as to the purpose of a PILON not necessarily fatal but leads to tax uncertainty.
Salary sacrifice schemes
35:43 Best Connection: the company set up a travel payment scheme (BSS) linked to a salary sacrifice scheme.
38:20 Salary sacrifice legislation under ITPA: the new rules mean that salary sacrifice schemes are now brought within the benefits legislation with some exceptions (eg electric cars, pensions, bicycles). However, contributions about £2k will be subject to NICs from April 2029. Whilst Best Connection predates all this legislation, it is still helpful on whether something is actually a salary sacrifice scheme. There is draft legislation - National Insurance Contributions Employer Pensions Contributions Bill - and further guidance promised.
Agency workers legislation
41:14 Tyler Security: were the dog handling services providing "personal services"? The supervision, direction and control "SDC" test.

Citations
Legislation
ss 338 and 339A Income Tax (Earnings & Pensions) Act 2003 (ITEPA)
s16 ITEPA
Chapter 5, part 7 ITEPA
ss49 - 61 ITEPA (IR 35)
Schedule 1AB ITEPA
s62 ITEPA
s406 ITEPA
s65 ITEPA
s69A and 69B ITEPA
National Insurance Contributions (Employer Pensions Contributions Bill
ss44 - 47 ITEPA
Chapters 7 and 10 Part 2 ITEPA
Cases
Mainpay Ltd v HMRC [2025] EWCA Civ 1290
Exchequer Solutions Ltd v HMRC [2024] UKUT 25 (TCC)
Ready Mixed Concrete (South East) Ltd v Minister of Pensions and National Insurance [1968] 2 QB 497
HMRC v Payroll & Pension Services (PPS Umbrella Company) Ltd [2024] EWCA Civ 995
Elphysic Ltd v HMRC [2025] UKUT 236 (TCC)
Saunders v HMRC [2025] UKUT 374 (TCC)
Abbott v Philbin [1961] AC 352
Bridges v Hewitt [1957] 1 WLR 674 (also known as Bridges v Bearsley)
Bryan Robson Ltd v HMRC [2025] UKFTT 56 (TC)
Basic Broadcasting Ltd v HMRC [2024] UKUT 165 (TCC)
HMRC v S&L Barnes Ltd [2024] UKUT 262 (TCC)
HMRC v Professional Games Match Officials Ltd [2024] UKSC 29
Atholl House Productions Ltd v HMRC [2022] EWCA Civ 501
Kickabout Productions Ltd v HMRC [2022] EWCA Civ 502.
Rawlinson v HMRC [2026] UKFTT 45 (TC)
HMRC v Tottenham Hotspur Ltd [2017] UKUT 453 (TCC)
Hasted v Horner [1995] STC 766
The Best Connection Group Ltd v HMRC [2024] UKFTT 1103 (TC)
Tyler Security Ltd v HMRC [2025] UKFTT 1250 (TC)

Producer: Peter Shevlin
A pod60 production for Pump Court Tax Chambers

Ben Elliott, Quinlan Windle and Sam Glover look at recent developments in litigation focusing on procedural issues such as late appeals (Medpro), burden of proof (Sintra), the jurisdiction of the tribunal, disclosure and duty of candour, use of AI in writing judgments, assessments and penalties (eg Mainpay).
2:07 Court of Appeal judgment in Medpro (late appeals and in particular the Martland approach) – The UT can give guidance and the correct guidance in relation to late appeals is theMartland approach. Higher courts can only interfere with that guidance if there has been an error of law. Has the CA widened the grounds for appeal? Some practical points arising from the decision.
20:50 Sintra - Court of Appeal judgment concerning burden of proof in penalty cases.
25:33 Jurisdiction of tribunal to consider public law points – in particular the recent decision in Morrisons. How to protect the taxpayer's position with parallel judicial review proceedings and statutory appeals.
38:30 Use of AI in writing judgments – How are the courts using AI?
40:45 Disclosure and the duty of candour – Do HMRC have a duty of candour before the FTT? Is it the same duty as in judicial review cases? Is it only HMRC who have a duty of candour in FTT cases?
43:40 Assessments, penalties and causation - Discussion of recent cases and principles laid down in Mainpay, Delphi and Boston Consulting Group.
Citations
Cases
Medpro Healthcare Ltd & Ruppai v HMRC [2026] EWCA Civ 14, [2026] STC 253
Martland v HMRC [2018] UKUT 178 (TCC)
Mitchell v News Group Newspapers [2013] EWCA Civ 1537, [2014] 2 All ER 430
Denton v TH White Ltd [2014] EWCA Civ 906, [2015] 1 All ER 880
HMRC v McCarthy & Stone [2014] UKUT 196 (TCC), [2014] STC 973
BPP Holdings Ltd v HMRC [2017] UKSC 55, [2017] 4 All ER 756
Perinpanathan v City of Westminster Magistrates Court [2010] EWCA Civ 40, [2010] 1 WLR 1508
Competition & Market Authority v Flynn Pharma Ltd [2022] UKSC 14, [2023] 1 All ER 97
Price and others v HMRC [2015] UKUT 164 (TCC)
Carbon Six Engineering Ltd v HMRC [2026] UKFTT 177 (TC)
HMRC v Sintra Global [2025] EWCA Civ 1661
Henryk Zeman SP Zoo v HMRC [2021] UKUT 182 (TCC), [2021] STC 1706
Treasures of Brazil v HMRC [2024] UKFTT 929
Caredav Ltd v HMRC [2023] UKUT 179 (TCC)
Chelsea Cloisters v HMRC [2025] UKFTT 205 (TC), [2025] SFTD 1105
Morrison Supermarkets v HMRC [2025] UKFTT 1542 (TC)
R (on the application of Archer) v HMRC [2017] EWCA Civ 1962, [2018] STC 38
R (on the application of Weis) v HMRC [2025] EWHC 2479 (Admin), [2025] STC 1659
Cobalt Data Centre 2 LLP v HMRC [2019] UKUT 342 (TCC), [2020] STC 23
Evans v HMRC [2025] UKFTT 01112 (TC)
Jordi Carulla Font v HMRC [2025] EWHC 3057 (Admin), [2025] STC 1935
Nottingham Forest Football Club v HMRC [2024] UKUT 145, [2024] STC 1105
Delphi Derivatives v HMRC [2026] UKUT 21 (TCC), [2026] STC 292
O'Neil & Ors v HMRC [2026] UKUT 13 (TCC), [2026] STC 199
Boston Consulting Group v HMRC [2026] UKUT 25 (TCC), [2026] STC 105
Lands Luo Limited v HMRC [2025] UKFTT 1207 (TC)
Jeneruhl Trading Ltd & Another v HMRC [2024] UKFTT 735 (TC)
Legislation
CPR rule 3.9
Rule 28 procedure
s29 Taxes Management Act
s36 Taxes Management Act
Producer: Peter Shevlin
A pod60 production for Pump Court Tax Chambers

Laura Poots KC and Thomas Chacko consider classification and characterisation in VAT cases.
2:00 What is meant by classification and characterisation: when you have identified you have a single supply or a set of multiple supplies, what is that supply? And is the position completely clear following Gray & Farrar?
2:50 The first step is identification of supply - to decide if you have a single or multiple supply - and then one looks at classification. Explanation of the two bases on which a single supply might be identified.
4:56 Is classification the final word on how the supply will be taxed?
Case law and what are the tests?
7:26 Card Protection Plan (CPP) Supplies – principal-ancillary supplies and how they are classified.
8:12 Levob Supplies - In classifying these, different courts have looked at "overarching" or "economic reality" test and the "predominant element" test.
10:45 Gray & Farrar. Court of Appeal has now confirmed that there is a hierarchy of three tests (1) predominant element (2) principal-ancillary (3) overarching supply.
12:00 Predominance test: This is the primary test. Look at economic purpose and the typical customer (qualitative as well as quantitative).
13:55 Principal-ancillary test: a sense check on predominance, but also useful in working out the number of elements.
15:41 Overarching test: can assist in deciding predominance.
17:00 In applying these tests, how do you identify the elements of the supply?
How does this all work in practice?
19:56 HMRC don't seem to view Gray & Farrar as settling the test in every case. What are HMRC's arguments and what are the problems with them?
21:05 HMRC argument 1: Individual elements cannot be singled out.
22:06 HMRC argument 2: subset of Levob supplies where no conceptual room for predominance test. HMRC's reliance on Blackrock and Deutsche Bank.
29:19 A practical example - Story Terrace. Court takes a lot of notice of contractual documentation and marketing descriptions. Potential relevance of online reviews. Demonstration of the importance of considering identification before classification.
CITATIONS
Blackrock Investment Management (UK) Ltd v HMRC [2020] STC 1445
Card Protection Plan Ltd v Customs and Excise Commissioners (Case C-349/96) [1999] STC 270
Finanzamt Frankfurt am Main V-Hochst v Deutsche Bank AG (C-44/11) [2012] STC 1951
HMRC v Gray & Farrar International LLP [2023] STC 327
Levob Verzekeringen BV and another v Staatssecretaris van Financien (C-41/04) [2006] STC 766
Město Žamberk v Finanční ředitelství v Hradci Králové (C-18/12) [2014] STC 1703
Spectrum Community Health CIC v HMRC [2024] STC 1124
Story Terrace v HMRC [2025] UKFTT 1554 (TC)
Target Group Ltd v HMRC [2018] UKFTT 226
Talacre Beach Caravan Sales Ltd v Customs and Excise Commissioners (Case C-251/05) [2006] STC 1671
European Commission v France (Case C-94/09) [2012] STC 573
EC v Grand Duchy of Luxembourg (Case C-274/15) [2017] ECR
Producer: Peter Shevlin
A pod60 production for Pump Court Tax Chambers

David Ewart KC and Laura Ruxandu look at judicial review in relation to tax cases from a procedural as well as substantive perspective.
when you can bring judicial review in a tax case.
what to do if you have alternative remedies.
the jurisdiction of the administrative court.
procedure for judicial review.

1: 13 The three broad areas in which you can bring judicial review in tax cases.
3:19 Area 1: Extra-statutory rulings - where HMRC resile on an earlier representation personal to the taxpayer. These claims cannot be brought in the tax tribunal. Whilst most of the case law is won by the HMRC, equally there are a lot of cases in which the HMRC accept the taxpayer's challenge.
10:49 Area 2: Where the tax payer has read and relied on a general statement in a published document/statement.
20:53 Area 3: Procedural errors- breach of natural justice, applications for disclosure.
26:42 Judicial review should be viewed as a last resort. It is a residual remedy and is not available if alternative remedies are available.
26:56 The jurisdiction of the administrative court to hear public law arguments such as judicial review.
36:00 Procedure for judicial review. You need to apply for permission. Differences to the Tribunal eg time limits, pre-action protocol. Very important to get early professional advice and evidence to cover the application as well as judicial review (if you get permission).
44:52 Increasing role of Upper Tribunal.
47:41 Difference of appeals to appeals in the Tribunal.
48:00 Strategic importance of threatening judicial review.
Cases
R (Hawarth) v HMRC [2021] UKSC 25
R (Locke) v HMRC [2019] EWCA Civ 1909
R (Refinitiv UK Holdings Ltd) & Anor v HMRC [2023] UKUT 00257 (TCC)
R (Airline Placement Ltd) v HMRC [2023] EWHC 1191 (Admin)
Murphy & Linnett v HMRC [2023] EWCA Civ 497
R (Aozora GMAC Investment Ltd) v HMRC [2019] EWCA Civ 1643
R (Rettig Heating Group Ltd) v HMRC [2025] UKUT 143 (TCC)
R (Archer) v HMRC [2017] EWHC 296 (Admin)
Zeman v HMRC [2021] UKUT 182 (TCC)
Harrison v HMRC [2023] UKUT 00038
Caerdav Ltd v HMRC [2023] UKUT 00179 (TCC)
Reed Employment v HMRC [2015] EWCA Civ 805
MCM v HMRC
Glencore v HMRC [2017] EWCA Civ 1716
Legislation
s50 Taxes Management Act
Producer: Peter Shevlin
A pod60 production for Pump Court Tax Chambers

Legislation
Part III and Schedule 5 of the Finance Act 1996
Section 42 and Schedule 12 of the Finance Act 2018
EU Landfill Directive (1999/31/EC)
Consultation on Reform of Landfill Tax in England and Northern Ireland (April 2025)
Paris Agreement 2015
s1 Climate Change Act 2008Renewed Agenda for European Union – United Kingdom cooperation common understanding (May 2025)
Environment Act 2021
The Environmental Targets (Residual Waste) (England) Regulations 2023, regulation 2

Cases
Waste Recycling Group Ltd v HMRC [2008] EWCA Civ 849; [2009] STC 200
Patersons of Greenoakhill Ltd v HMRC [2016] EWCA Civ 1250; [2017] 1 WLR 1210; [2017] STC 225
Devon Waste Management Ltd v HMRC [2021] EWCA Civ 584; [2021] 4 WLR 89; [2021] STC 990

Joshua Stevens | Pump Court Tax Chambers
Zizhen Yang | Pump Court Tax Chambers

Producer: Peter Shevlin
A pod60 production for Pump Court Tax Chambers