Exel Computer Systems PLC v Revenue & Customs (NATIONAL INSURANCE CONTRIBUTIONS : Exemptions and reliefs) [2018] UKFTT 346 (TC) (23 June 2018)

Exel Computer Systems PLC v Revenue & Customs (NATIONAL INSURANCE CONTRIBUTIONS : Exemptions and reliefs) [2018] UKFTT 346 (TC) (23 June 2018)

The Tribunal held that HMRC's claim for 2008-09 was time barred as no explicit agreement or specified payment on account was made to stop the limitation period. The provision of private fuel constituted a taxable benefit as employees received fuel for private use without timely reimbursement, failing to meet the requirements of section 151 ITEPA 2003. The arrangements did not amount to a fair bargain, and the benefit code was engaged. The section 8 decisions were not reduced as they were based on best judgement.

Citation
[2018] UKFTT 346 (TC)
Parties
Appellant: Exel Computer Systems PLC; Respondents: The Commissioners for Her Majesty’s Revenue & Customs
Jurisdiction
United Kingdom
Judgment Date
23 June 2018
Procedural Posture
Appeal / First Tier Tribunal (tax) Decision
Outcome
Appeal dismissed in part; HMRC's claim for 2008-09 is time barred, but liability for other years upheld.
Legal Topics
National Insurance Contributions, Benefits in Kind, Limitation Periods, Employment Income, Car Fuel Benefit, Section 151 ITEPA 2003
Tax Law Employment Law National Insurance Contributions Benefits in Kind Limitation Periods Employment Income Car Fuel Benefit Section 151 ITEPA 2003

Case Brief

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Parties

Exel Computer Systems PLC

Appellant

The Commissioners for Her Majesty’s Revenue & Customs

Respondents

Procedural Posture

Appeal / First Tier Tribunal (tax) Decision

Legal Issues

  1. 1 Whether HMRC's claim for Class 1A NIC for 2008-09 is time barred under the Limitation Act 1980
  2. 2 Whether the provision of car fuel to employees constituted a taxable benefit under ITEPA 2003
  3. 3 Whether employees made good the cost of private fuel within the required time to avoid a NIC charge under section 151 ITEPA 2003

Ratio Decidendi

The Tribunal held that HMRC's claim for 2008-09 was time barred as no explicit agreement or specified payment on account was made to stop the limitation period. The provision of private fuel constituted a taxable benefit as employees received fuel for private use without timely reimbursement, failing to meet the requirements of section 151 ITEPA 2003. The arrangements did not amount to a fair bargain, and the benefit code was engaged. The section 8 decisions were not reduced as they were based on best judgement.

Court Disposition

Appeal dismissed in part; HMRC's claim for 2008-09 is time barred, but liability for other years upheld.

Orders

  • HMRC's section 8 decision for 2008-09 is set aside as time barred.
  • Liability for Class 1A NIC for tax years 2005-06, 2006-07, 2009-10, and 2010-11 is upheld.