Court Grants Extension Of Time To Pursue JR Despite "Unjustified Delay"

In Weis v HMRC [2025] EWHC 2479 (Admin), the High Court granted permission for the taxpayer to proceed with his application for judicial review ("JR") in somewhat unusual circumstances.

• The first unusual circumstance was that the application for JR was made 5 years after HMRC had made the decisions under challenge. (The obligation under the Civil Procedure Rules is for such an application to be filed "promptly; and in any event not later than 3 months after the grounds to make the claim first arose").
• The second unusual circumstance was that a statutory appeal against the HMRC decision under challenge had already been determined by the First-tier Tribunal ("F-tT") in HMRC's favour.

Beyond serving as a reminder of key procedural considerations when pursuing JR in a tax context (which are considered further below), the case serves to showcase alternative options available to a taxpayer seeking reconsideration of HMRC's actions (and the limitations of those options).

Background

In January 2000, the taxpayer had made a claim to be domiciled outside the UK (viz, in Israel). HMRC enquired into that claim but confirmed (later that same year) that it was accepted.

The taxpayer's case was that following HMRC's confirmation of his claim (a) he made offshore investments (on the understanding that he would be taxed on the remittance basis), and (b) HMRC amplified the assurance (that they accepted he was domiciled in Israel) through further conduct.

The taxpayer alleged that it was not until a meeting in February 2013 that HMRC first stated that they would no longer stand by the ruling given in 2000. In May 2019, HMRC issued closure notices (for "tax years between 2005-2013") on the basis that the taxpayer was (and had been throughout the relevant period) domiciled within the UK.

In response to the closure notices, the taxpayer took the following steps:

• In June 2019, the taxpayer lodged an appeal with HMRC against the closure notices.
• In July 2019, the taxpayer requested that HMRC conduct a statutory review of the matters in question. In that context, the taxpayer alleged that HMRC's prior ruling had created a legitimate expectation (that HMRC accepted he was domiciled outside the UK) which expectation had been breached by HMRC's subsequent actions in issuing the closure notices in the terms they had.
• In November 2021, HMRC concluded the statutory review by upholding the closure notices (indicating that the allegations regarding breach of legitimate expectation were outside the scope of what could be determined in a statutory review). The taxpayer thereafter notified his appeal to the F-tT in December 2021.

In parallel:

• In June 2021, the taxpayer utilised HMRC's formal complaints process (guidance regarding which is available here: https://www.gov.uk/hmrc-internal-manuals/complaints-handling-guidance/chg315). HMRC initially rejected the complaint, leading to it being escalated (internally) in December 2021. That second-tier complaint was rejected in May 2022, following which the taxpayer referred the complaint (which included his allegation that HMRC had breached a legitimate expectation) to the Adjudicator's Office ("AO") in August 2022.
• Apparently due to an administrative oversight, the complaint to the AO did not progress, though it appears the taxpayer did not become aware of this until early 2024. In May 2024, the AO told the taxpayer that it would not review his complaint.
• At some point during the intervening period, the parties had agreed to engage in alternative dispute resolution ("ADR"), though this was abandoned due to ill health on the part of the taxpayer.

Within a month of the AO's decision not to review the complaint, the taxpayer applied to the Court for JR. Initially, that application was refused on the papers.

In March 2025, the F-tT released its decision in the statutory appeal, finding against the taxpayer (that is, finding that he had acquired a domiciled of choice within the UK prior to 2005/06).

Issues

Following refusal of his application for JR on the papers, the taxpayer applied to renew his application at a hearing.

In the context of that renewal, the judge (Sheldon J) had no difficulty in finding that the taxpayer was well outside the ordinary time limit for such an application (being, as set out above, "promptly; and in any event not later than 3 months...") given that the impugned decision was the issue of closure notices (which had occurred some 5 years prior to the taxpayer's original application for JR).

Accordingly, what the judge had to decide was (1) whether to extend that time limit, and (if so) (2) whether to grant permission for the taxpayer to proceed with the JR.

Decision and observations

As noted in the judgment, the Administration Court Guide provides that, when considering whether to extend time, the Court should:

In relation to this test, the Court emphasised (with reference to the decision of the Privy Council in Maharaj v National Energy Corporation [2019] 1 WLR 983) that the test is whether there is a good reason for extending time, and not simply whether there was a good reason for the delay.

In applying the test, and in coming to the conclusion that there was a good reason for extending the time limit, the Court made a number of observations which have potential read-across to other cases.

• First, the Court emphasised that time (for applying for JR) began to run when the closure notices were issued, and not at some later time – for example, when the statutory review concluded (upholding HMRC's actions), or when the AO communicated its decision not to review the complaint. This is important for taxpayers to note, though the cautious taxpayer should be aware that in certain cases time may start running before the issue of a formal notice or assessment (eg, where it is inevitable that a decision taken by HMRC will ripen into a formal assessment).
• Second, unlike the DPT review mechanism at issue in R (oao Glencore) v HMRC [2017] EWCA Civ 1716, the Court did not consider the statutory review or complaints processes in issue to be alternative remedies (of the sort which would have prevented a JR from proceeding). This was relevant to the Court's decision on when time started to run, but also provided helpful guidance concerning the limits of the AO complaints process: that is, the Court concluded that the proper remit of the AO did not extend to determining issues of legitimate expectation.
• Third, the fact that the taxpayer had been guilty of unjustifiable delay (following the conclusion of the ADR process in 2023) did not operate as an automatic bar to extending time (and, in fact, did not operate as a bar in this particular case). Whilst this should not be taken as an encouragement for taxpayers to risk delaying applications for JR unnecessarily, it is encouraging to see the Courts taking care to consider the facts of individual cases in the round.
• Fourth, the Court considered that the taxpayer's claim for legitimate expectation had a realistic prospect of success. This is encouraging for several reasons. First, it is encouraging that the Court considered a claim for legitimate expectation could have potency even after it had been determined (in a related statutory appeal) that tax is due. Second, it is encouraging because it acknowledges that though HMRC cannot make forward tax agreements, it may be unlawful (in a public law sense) for HMRC to depart from a position (from one year to the next) where there has been no material change in circumstance.
• Fifth, in circumstances where HMRC was well aware of the nature of the challenge to its decision (and delay did not affect the evidence available to deal with the claim), HMRC suffered no prejudice by the delay. Conversely, the sums at stake for the taxpayer (£3.6m) were substantial, and he had an arguable case that HMRC's statements and conduct had engendered a legitimate expectation.

Although the taxpayer was successful in obtaining an extension of time and permission to proceed with JR proceedings, the case serves as a cautionary tale - reminding taxpayers of the importance of formulating carefully an overall strategy for resolving their dispute with HMRC and of ensuring that all procedural steps are observed in time in order to protect their chosen avenues of challenge.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.