Lucky Eyes Ltd v The Commissioner Of HMRC

Lucky Eyes Ltd v The Commissioner Of HMRC

None of the employees were fixed rate employees as there was no evidence of contracts for annual salary; therefore, the reference salary must be calculated under the variable rate rules. The amounts overclaimed are subject to assessment and recovery under the Finance Act 2020. Set-off of underclaims against overclaims is not allowed between different claim periods.

Parties
Appellant: Lucky Eyes Limited; Respondents: The Commissioners for His Majesty’s Revenue and Customs
Jurisdiction
England and Wales
Judgment Date
27 September 2024
Procedural Posture
Tax Appeal / First Tier Tribunal Judgment
Outcome
Appeal dismissed
Legal Topics
Coronavirus Job Retention Scheme, Income Tax Assessment, Overclaimed Support Payments, Finance Act 2020, Employment Contracts
Tax Law Administrative Law Coronavirus Job Retention Scheme Income Tax Assessment Overclaimed Support Payments Finance Act 2020 Employment Contracts

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Parties

Lucky Eyes Limited

Appellant

The Commissioners for His Majesty’s Revenue and Customs

Respondents

Procedural Posture

Tax Appeal / First Tier Tribunal Judgment

Legal Issues

  1. 1 Whether Lucky Eyes Limited was entitled to the amounts claimed under the CJRS for the relevant periods
  2. 2 Whether the employees were fixed rate or variable rate employees under the CJRS
  3. 3 Whether set-off of underclaims against overclaims between claim periods is permissible

Ratio Decidendi

None of the employees were fixed rate employees as there was no evidence of contracts for annual salary; therefore, the reference salary must be calculated under the variable rate rules. The amounts overclaimed are subject to assessment and recovery under the Finance Act 2020. Set-off of underclaims against overclaims is not allowed between different claim periods.

Court Disposition

Appeal dismissed

Orders

  • Assessments reduced to £8,284.27 for the period ended 31 March 2021 and £18,010.40 for the period ended 31 March 2022
  • Appeal dismissed