DP Langan Ltd v Revenue and Customs (INCOME TAX - Coronavirus job retention scheme) [2025] UKFTT 958 (TC) (07 August 2025)

DP Langan Ltd v Revenue and Customs (INCOME TAX - Coronavirus job retention scheme) [2025] UKFTT 958 (TC) (07 August 2025)

The CJRS Direction requires that claims for fixed rate employees be based on the salary paid in the last period before 19 March 2020. Paragraph 7.12 does not allow employers to increase the reference salary by paying higher amounts after that date; it only allows correction of underpayments to meet the 80% threshold. The appellant's claims based on increased salaries were not permitted, and the assessments were validly raised and correctly amended by HMRC.

Citation
[2025] UKFTT 958
Parties
Appellant: DP Langan Limited; Respondents: The Commissioners for His Majesty's Revenue and Customs
Jurisdiction
United Kingdom
Judgment Date
07 August 2025
Procedural Posture
Income Tax Appeal / First Tier Tribunal (tax Chamber) Final Judgment
Outcome
Appeal dismissed
Legal Topics
Coronavirus Job Retention Scheme, Income Tax Assessments, Statutory Interpretation, Reference Salary, Furlough, PAYE, HMRC Compliance
Tax Law Public Law Coronavirus Job Retention Scheme Income Tax Assessments Statutory Interpretation Reference Salary Furlough PAYE +1 more

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Parties

DP Langan Limited

Appellant

The Commissioners for His Majesty's Revenue and Customs

Respondents

Procedural Posture

Income Tax Appeal / First Tier Tribunal (tax Chamber) Final Judgment

Legal Issues

  1. 1 Whether DP Langan Limited was entitled to claim CJRS grants based on increased salaries after 19 March 2020
  2. 2 Interpretation of paragraph 7.12 of the CJRS Direction
  3. 3 Calculation of reference salary for fixed rate employees under CJRS

Ratio Decidendi

The CJRS Direction requires that claims for fixed rate employees be based on the salary paid in the last period before 19 March 2020. Paragraph 7.12 does not allow employers to increase the reference salary by paying higher amounts after that date; it only allows correction of underpayments to meet the 80% threshold. The appellant's claims based on increased salaries were not permitted, and the assessments were validly raised and correctly amended by HMRC.

Court Disposition

Appeal dismissed

Orders

  • Taxpayer's appeal against the assessments is dismissed as amended on review.
  • Assessments increased in accordance with HMRC's review conclusion letter.