Stage One Creative Services Limited v HMRC
Case number: TC09358
25 October 2024
H&H used Legal Rooms to make an R&D tax relief claim and during the Tribunal presented evidence as to why he felt them to be a reputable company. The FTT did not discuss the R&D as this matter had already been conceded, this case only considered how a penalty should be applied.
The FTT found in favour of H&H and stated, ‘it is for the Respondents (HMRC) to prove a careless inaccuracy, not for the Appellant (H&H) to establish a “reasonable excuse’.
The test was based on the balance of probabilities that the taxpayer had taken reasonable care.
When selecting an advisor, businesses need to show they have taken the time to consider which agent they wish to use and why they chose them.
There is an implied requirement to show skill and care in selecting an advisor and shouldn’t just rely on a speculative email or cold call without further due diligence into the standing of the agent.
This is good news for genuine businesses who have been given poor advice from rouge agents. It is a shame that a business had to go through this time intensive process whereas, the agent has given bad R&D advice without any repercussions. This does nothing to improve that standards of the industry and begs the question as to whether we need a deterrent too offering bad advice and poor agent practice.
Case number: TC09358
Case number: TC09332
Case number: TC09235