In Roderick Thomas & Stuart Thomas v HMRC [2014] TC 03412 the taxpayers attempted to prevent HMRC from proceeding in tax litigation on the grounds that it had “no reasonable prospect of success”.

They applied under Tribunal Procedure Rule 8 that HMRC is barred from proceeding on the grounds that it had no reasonable prospect of success.

The FTT pointed out that:

"... the Appellants face a high bar in relation to their application. It is not sufficient to cast doubts on whether HMRC would be successful at the substantive hearing of the Appeal Proceedings. Rather, the Appellants must show that HMRC’s defence of the Appeal Proceedings is no more than fanciful.”

The tribunal noted that:

The FTT held that the brothers had not convinced the tribunal that HMRC had no reasonable prospect of success. This was despite the fact that it noted that they may subsequently succeed in connection with the settlor issue, flaws in the discovery assessments and/or the amounts assessed.

External link:

Roderick Thomas & Stuart Thomas v HMRC TC 03412