Tax litigation in the UK (England and Wales): overview

A Q&A guide to civil and criminal tax litigation in the UK (England and Wales).

This Q&A provides a high level overview of the key practical issues in civil and criminal tax litigation, including: pre-court/pre-tribunal process, trial process, documentary evidence, witness evidence, expert evidence, closing the case in civil and criminal trials, decision, judgment or order, costs, appeals, and recent developments and proposals for reform.

To compare answers across multiple jurisdictions, visit the Tax Litigation: Country Q&A tool.

The Q&A is part of the global guide to tax litigation. For a full list of jurisdictional Q&As visit


Overview of tax litigation

Issues subject to tax litigation

1. What are the most common issues subject to tax litigation in your jurisdiction?

In recent years, the UK tax authority, HM Revenue & Customs (HMRC), has become more aggressive, in particular in the area of tax evasion. This has resulted in significant growth in UK tax disputes, both in a civil and criminal context. In civil tax cases, HMRC has challenged and continues to challenge a number of alleged "tax avoidance structures". Given the clamp down on tax evasion, civil investigations of fraud arrangements have increased significantly, and it is expected that criminal prosecutions for tax fraud-related offences may increase in future.

Legislative framework

2. Outline the legislative framework and principal pieces of legislation governing both civil and criminal tax litigation.

There are three different legal systems in the UK:

  • English law, which is applicable in England and Wales.

  • Scots law, which is applicable in Scotland.

  • Northern Ireland law, which is applicable in Northern Ireland.

HMRC is the single tax authority for the UK. This chapter deals only with the laws applicable in England and Wales.

Civil tax litigation

The legislative framework governing assessments by HMRC, and appeals against assessments and other decisions made by HMRC, differs according to the type of tax in dispute (that is, direct taxes, including corporation tax and income tax, or indirect taxes such as VAT) and whether the taxpayer is an individual, a partnership or a company:

  • The Taxes Management Act 1970 applies to individuals and partnerships.

  • Schedule 18 of the Finance Act 1998 applies to companies.

  • The Value Added Tax Act 1994 applies in relation to VAT.

However, the broad disputes and litigation regime set out in each of these acts is very similar.

The English legal system is a common law system. In the fiscal context, there are two principal categories of remedies available to taxpayers in respect of a tax dispute, that is, statutory remedies and common law remedies.

Where statute does not provide a remedy for a taxpayer, a common law remedy may be available, including judicial review. Statutory appeals are heard in the Tax Tribunal and common law claims are heard in the High Court.

Criminal tax litigation

In the criminal context, HMRC acts in accordance with its criminal prosecution policy. It can take civil action by using its civil investigation of fraud (CIF) procedures through a contractual disclosure facility (CDF) or under Code of Practice 9 (COP9). Under a CDF, taxpayers can agree to make disclosure of irregularities in their tax affairs to HMRC and to provide payment of outstanding tax. In return, HMRC will agree not to pursue a criminal investigation, provided that the taxpayer adheres to the agreement. However, in certain circumstances, criminal proceedings will be commenced against the taxpayer and the matter will proceed through the criminal courts.

HMRC's criminal investigations powers in England and Wales are codified in the Police and Criminal Evidence Act 1984. In addition, further criminal investigation powers are codified in the Serious Organised Crime and Police Act 2005 and the Proceeds of Crime Act 2002. These powers can only be used by HMRC officials who are authorised to do so.

Tax evasion and other criminal tax offences

3. What are the key elements that constitute tax evasion and other main criminal tax offences in your jurisdiction?

There is no specific offence of "tax evasion", but there are several categories of tax evasion-related offences requiring that:

  • The person acted in a fraudulent manner.

  • The person was dishonest according to ordinary standards of a reasonable person and he or she realised that what he or she was doing was dishonest.

A strict liability offence of failure to declare offshore taxable income has been introduced, and there are ongoing consultations regarding a corporate criminal offence of failure to prevent tax evasion. The other tax-related criminal offences include:

  • Fraud.

  • False accounting.

  • Fraudulent evasion of VAT.

  • False statements for VAT purposes.

  • Fraudulent evasion of income tax.

  • Improper importation of goods.


Pre-court/pre-tribunal process

Assessment, re-assessments and administrative determinations in civil law

4. Outline the procedure for tax assessments, re-assessments and administrative determinations in civil law.

The UK has a regime of self-assessment, which requires a taxpayer to assess its own tax affairs and declare these annually in a tax return. However, where the UK tax authority, HMRC, wishes to query or disagrees with the self-assessment, it can commence an enquiry and come to its own decision. The taxpayer is entitled to appeal HMRC's decision, which gives rise to the disputes and litigation process. Before lodging an appeal, a taxpayer can also request an internal review of the decision, which must be conducted by an officer who was not previously involved in the matter.

HMRC can provide a company, individual or partnership with notice to deliver a return, which must include a self-assessment of the tax due.

There are specific time periods within which to file returns, depending on whether the taxpayer is a company, a partnership or an individual.

The period during which HMRC can investigate commences once a return has been filed. HMRC can enquire into a return for a limited period of time, usually within 12 months of the date the return was filed. HMRC does not need to give a reason for opening an enquiry, and there is no right of appeal against such a decision. HMRC has extensive powers of inspection and can require the taxpayer to provide information or documents (Schedule 36, Finance Act 2008). HMRC can also require third parties to provide information.

An enquiry is completed when HMRC issues a closure notice stating its conclusions.

HMRC can only assess returns outside the 12-month limit under specific circumstances, using a discovery assessment, where there has been a loss of tax resulting from a taxpayer's careless or deliberate actions, and HMRC could not reasonably have been expected to be aware of the under-assessment when the enquiry time limit expired. For example, with regard to companies, HMRC can make an assessment within the following periods, starting from the end of the relevant account period:

  • Four years, if the under-assessment is due to insufficient disclosure of information.

  • Six years, if the under-assessment is due to the taxpayer's carelessness.

  • 20 years, if the under-assessment is due to a deliberate act of the taxpayer.

Resolving disputes before commencing court proceedings

5. What are the main procedures used to resolve disputes before commencing proceedings in a civil court/tribunal?

In civil cases, a taxpayer has a number of options to consider before commencing formal appeal proceedings. Before notifying an appeal to the First-tier Tribunal, the taxpayer can request an internal review, during which the taxpayer's case will be re-examined by an HMRC officer who has had no previous involvement in the case. In addition, the parties can consider alternative dispute resolution (ADR) mechanisms, including mediation.

Elements of the offence in criminal law

6. What are the elements of the main criminal law offences in tax litigation?

The main fraud offences are set out in the Fraud Act 2006 and the Theft Act 1968. The main fraud offences are:

  • Fraud by false representation.

  • Fraud by failing to disclose information where there is a duty to do so.

  • Fraud by abuse of position.

The main theft offences that can be relevant in the tax context are false accounting and false statements by company directors. There is also a common law offence of cheating the public revenue. These all require the prosecution to prove dishonesty. Therefore, a principal element of any defence will be to show that the taxpayer did not, or may not have, behaved dishonestly.

Early resolution

7. What are the main procedures used for the early resolution of criminal law offences before trial?

Once criminal proceedings have been commenced, an individual can plead guilty and, under normal sentencing guidelines, will be entitled to a reduction of up to one-third of any term of imprisonment imposed.

Under the Serious and Organised Crime and Police Act 2005, a defendant can also receive either immunity from prosecution (in rare cases) or a reduction in sentence, in exchange for assistance/full disclosure of the offence. From 24 February 2014, deferred prosecution agreements (DPAs) apply to corporate offenders only and for certain economic crimes only. These include cheating the public revenue, fraudulent evasion of VAT, false accounting and certain offences under the Customs and Excise Management Act 1979.

Format of the hearing/trial

8. What format does the hearing/trial take?

Hearings are usually held in public, except in exceptional circumstances. Only a limited number of cases that require no evidence can be decided on written submissions.

If a party fails to attend a hearing, the First-tier Tribunal (FTT) can still proceed with the hearing if the FTT is satisfied that the party has been notified of the hearing, or that reasonable steps have been taken to notify the party of the hearing, and it considers that it is in the interest of justice to proceed with the hearing.

Role of the judge/arbitrator/tribunal members

9. What is the role of the judge/arbitrator/tribunal members in both civil and criminal tax litigation?

Civil tax litigation

The judge makes the final decision in the appeal. A decision of the First-tier Tribunal becomes final if there is no further appeal.

In the case of arbitration, the arbitrator will issue a final, binding and usually confidential award.

Criminal tax litigation

In the Magistrates' Court, the magistrate decides on both the facts and the law and passes the sentence following conviction. However, if the sentence is likely to be greater than six months' imprisonment, the case will be committed to the Crown Court for sentencing.

In the Crown Court, the jury decides on the facts, and the judge decides on the law. The judge determines the sentence following conviction. A defendant who pleads guilty will be sentenced on the facts set out in the prosecution case. If there is any challenge by the defendant to any significant part of the prosecution case, the judge will decide the facts on which the sentence will be passed, usually after a hearing on the issue before the judge sitting alone.

Commencement of proceedings: civil law

10. What is the procedure for commencing tax litigation proceedings in civil law and/or a taxpayer appealing a decision of the tax authority?

Taxpayers have a statutory right to appeal to a specialist tax tribunal against HMRC assessments and decisions relating to direct tax. For indirect taxes, such as VAT, a specific appeals regime is provided for in the VAT Act 1994. The specialist tax tribunal is the Tax Chamber of the First-tier Tribunal (FTT). The FTT is a statutory body, created under the Tribunals, Courts and Enforcement Act 2007 (TCEA). It is divided into chambers and has jurisdiction to hear appeals against decisions made by HMRC. The procedures of the Tax Chamber of the FTT are governed by the Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009. Scotland has its own regulations, which provide for a similar tribunal structure.

Before appealing to the FTT, the taxpayer must send notice of appeal to HMRC. This notice must be in writing and sent within a specified time limit, normally 30 days from the date of the original decision.

Once HMRC has been notified, the taxpayer must initiate proceedings by sending notice of its appeal to the FTT. There is a standard form for giving notice of appeal. The notice must include the:

  • Taxpayer's details.

  • Decision appealed against.

  • Result the taxpayer is seeking.

  • Grounds for making the appeal.

The FTT then gives notice of the appeal to HMRC. HMRC is represented by HMRC's solicitors' office, and service of all documents and notifications in the appeal is made on that office.

After receiving the notice of appeal, the FTT must give a direction allocating the case to one of the following categories:

  • Default paper cases.

  • Basic cases.

  • Standard cases.

  • Complex cases.

The FTT has discretion to classify a case as a complex case where it considers that the case involves any of the following:

  • Lengthy or complex evidence.

  • A lengthy hearing.

  • A complex principle or issue.

  • A large financial sum.

The classification of a case as complex allows for a special costs regime (that is, the FTT can make an order for costs against the unsuccessful party). This is different from the usual cost regime, which is tax-neutral so that each party pays its own legal costs. However, the taxpayer has the choice to "opt out" of the complex case cost regime if it informs the FTT and HMRC that it wishes to do so within 28 days of notification that the case has been classified as a complex case.

11. Must a taxpayer pay the disputed tax before leave to appeal the tax authority's decision is granted?

In appeals against decisions relating to direct taxes, the taxpayer can apply to postpone paying tax that it does not believe to be due until after the outcome of the appeal. The application must be made to HMRC first. If HMRC refuses to postpone payment, the taxpayer can apply to the First-tier Tribunal (FTT).

In appeals against decisions regarding indirect taxes, the taxpayer must pay the amount of tax that is being appealed in order to progress the appeal, unless the taxpayer can show that payment of this amount would cause the taxpayer to suffer hardship. The Finance Act 2014 introduced significant new provisions that require taxpayers using avoidance schemes to pay the disputed tax upfront where HMRC issues accelerated payment notices (APNs). APNs can be issued where there is an open appeal or enquiry, and any of the following applies:

  • A follower notice has been issued.

  • The taxpayer is using certain arrangements that have been disclosed under the Disclosure of Tax Avoidance Schemes Rules.

  • A general anti-abuse rule counteraction notice has been issued.

Penalties can be applied in the case of late payment.

Commencement of proceedings: criminal law

12. What is the procedure for commencing tax litigation proceedings in criminal law?

Criminal investigations by HMRC

It is HMRC's policy to deal with suspected serious tax fraud using its civil investigation of fraud (CIF) procedures, although it reserves the right to pursue a criminal investigation where it considers that this is necessary and appropriate.

Where HMRC decides to investigate using its CIF procedures, the taxpayer is given an opportunity to disclose irregularities in its tax affairs. Following this, HMRC will agree not to seek a prosecution for a tax fraud committed in any period before the date on which it first informed the taxpayer of its decision to investigate using the CIF procedures. However, if the taxpayer provides materially false statements or documents with the intention to deceive HMRC, HMRC can conduct a criminal investigation of that conduct.

Prosecution of criminal tax offences

While HMRC is responsible for investigating alleged tax offences, it is not responsible for criminal prosecutions. The decision whether to bring a criminal prosecution is made by an independent prosecuting authority:

  • The Crown Prosecution Service (CPS) in England and Wales.

  • The Public Prosecution Service for Northern Ireland in Northern Ireland.

  • The Crown Office and Procurator Fiscal Service in Scotland.

In England and Wales, the CPS acts in accordance with the Code for Crown Prosecutors, which is a public document issued by the Director of Public Prosecutions and which sets out the general principles Crown prosecutors should follow when they make decisions on cases. The Code sets out a two-stage test:

  • The first test is whether there is enough evidence against the defendant. When deciding whether there is enough evidence to charge, Crown prosecutors must consider whether evidence can be used in court and is reliable and credible. Crown prosecutors must be satisfied that there is enough evidence to provide a "realistic prospect of conviction" against each defendant.

  • The second stage is the public interest test, namely whether it is in the public interest for the CPS to bring the case to court. A prosecution will usually take place unless the prosecutor is certain that the public interest factors against prosecution outweigh those in favour.

Where criminal proceedings are contemplated, a taxpayer can make representations to the CPS that the evidential and/or public interest tests are not met and that proceedings should not be instituted.

Criminal proceedings in England and Wales are, depending on the circumstances and the seriousness of the offence, tried either before a Magistrates Court or the Crown Court.

Government response

13. How has the government responded to recent civil and criminal law cases to improve the court procedure?

Given the increase in HMRC's powers, more tribunal judges have been appointed.

In April 2010, a new Central Fraud Division was formed within the Crown Prosecution Service. This Division provides a specialist national prosecution and advisory service for complex, sensitive and high-value fraud and corruption cases throughout England and Wales, and for all revenue fraud cases investigated by HMRC.

Burden of proof

14. What is the burden of proof in both civil and criminal tax litigation proceedings?

Civil law

The burden of proof is on the taxpayer. The taxpayer must prove its case on a balance of probabilities. This means that the taxpayer must show that it is more likely than not that its case is made. Where the taxpayer provides evidence in support of its case, HMRC bears an evidential burden to challenge that case, either by producing its own evidence or by showing that the taxpayer's evidence should not be accepted.

In particular instances, the burden of proof can fall on HMRC. For example, in respect of discovery assessments and penalties, HMRC must show that the statutory conditions for issuing the discovery assessment or penalty are satisfied.

Criminal law

The burden of proof is on the state. The standard of proof is beyond reasonable doubt, that is, a jury or magistrate must be satisfied that the defendant is guilty of the offence.

Main stages

15. What are the main stages of typical court proceedings for tax disputes?

Civil law

The First-tier Tribunal (FTT) can regulate its own procedure. It can make directions on its own initiative or on the application of either party. Directions are usually agreed between the parties and can provide for the following stages:

  • The filing date of HMRC's statement of case.

  • Whether the taxpayer must file a statement of case and the date for doing so.

  • The date on which each party must provide a list of documents on which it intends to rely, and any agreed statement of facts and issues.

  • Dates on which to exchange witness evidence and expert evidence (if any).

  • The date by which both parties must provide the FTT with dates that are not suitable for a hearing, and file appeal bundles.

  • The timetable for the exchange of skeleton arguments.

Once all procedural requirements have been complied with, the hearing will commence. The appellant will open the case and call its witnesses. Witnesses can be cross-examined by HMRC's representative and then re-examined by the appellant's representative. At the end of the appellant's case, HMRC will proceed to call its witnesses for examination-in-chief, cross-examination and re-examination. Both representatives will then submit their respective arguments. The judge can then adjourn the case to consider his decision or make his decision immediately.

Criminal law

The relevant court (the Magistrates Court or the Crown Court) will issue directions that set out the steps to be taken by each party.

In most cases relating to tax fraud, the case will come before the Crown Court. There will be a plea and case management hearing at which a defendant can enter his plea. If the defendant does not formally enter a plea or pleads not guilty, the judge can issue directions for the Crown Prosecution Service (CPS) and the defendant's solicitor to comply with prior to trial. At an appropriate hearing, the defendant will be "arraigned" by putting the "charges" or "counts" to him and will formally enter his plea.

Prior to trial, the CPS must serve on the defendant all the evidence on which it intends to rely to prove the defendant's guilt.

Once the CPS has made its initial disclosure, the defendant must, within 14 days, serve a defence case statement on the CPS and send a copy of this statement to the Crown Court.

Part 3 of the Criminal Procedure and Investigations Act 1996 also creates a statutory scheme for preparatory hearings in serious, complex or lengthy cases, which can be used to identify important issues for the jury.

At trial, the procedure is broadly as follows:

  • The jury will be sworn in, after which prosecuting counsel will open the case, explaining what the case is about and what evidence he intends to call.

  • The witness statements can be read without the witness attending. However, if the witness statements are not accepted, the prosecution witnesses will be called in turn to give evidence. They can then be cross-examined by the defence counsel and re-examined by the prosecuting counsel.

  • At the conclusion of the prosecution case, the defence counsel can make a submission to the judge (in the absence of the jury) that there is no case for the defendant to answer:

    • if the submission of no case to answer is successful, the jury will be directed to return a verdict of not guilty;

    • if the submission of no case to answer is unsuccessful, the defence counsel will present the defendant's case.

  • If defence counsel is calling witnesses, they can make an opening speech to the jury and then proceed to call witnesses to give evidence-in-chief. These witnesses can then be cross-examined and re-examined.

  • At the conclusion of the defence case, both the prosecuting and the defence counsel will in turn deliver their closing speeches to the jury.

  • The judge will then sum up the issues of fact and law for the jury and the jury will retire to consider its verdict in private.

  • If the jury finds the defendant guilty, the judge will proceed to sentence the defendant either immediately or, if necessary, after an adjournment so that pre-sentence reports can be obtained before sentencing.


Documentary evidence

Disclosure of documents in civil proceedings

16. What documents must the parties disclose to the other parties and/or the court in civil proceedings? Are there any detailed rules governing this procedure?

Subject to any direction to the contrary, each party must provide the First-tier Tribunal and every other party with a list of documents containing all of the relevant documents that the party has in its possession, has the right to possess or copy, and intends to rely upon or produce during the proceedings.

The party providing the list of documents must allow every other party to inspect or make copies of the documents on the list.

Special rules/considerations

17. Are there any special rules or considerations concerning the disclosure or discovery of documents in civil tax litigation?

In civil cases, a party is not required to disclose documents that are privileged. Privilege attaches to confidential communications between lawyers and their clients that are:

  • Made for the purposes of giving or receiving legal advice.

  • Produced for the dominant purpose of seeking or obtaining advice in relation to litigation that is either anticipated or ongoing.

A specific tribunal procedure applies in circumstances where HMRC disputes the claim for privilege by the taxpayer in respect of certain documents.

Disclosure in criminal proceedings

18. What documents must the parties disclose to the other parties and/or the court in criminal proceedings? Are there any detailed rules governing this procedure?

The prosecution must disclose any material on which it intends to rely and any other relevant material (that is, material that can reasonably be considered capable of assisting the defence or undermining the prosecution). The defence can apply to the court for disclosure of further material.

Special rules/considerations

19. Are there any special rules or considerations concerning the disclosure of documents in criminal tax litigation?

Considerations regarding privilege also apply in criminal cases (see Question 17).


Witness evidence

Trial considerations

20. Do witnesses of fact give oral evidence or do they just submit written evidence? Is there a right to cross-examine witnesses of fact?

Civil law

The First-tier Tribunal (FTT) can issue directions specifically relating to witnesses.

The FTT can issue a direction for evidence or submissions to be given either:

  • Orally at a hearing.

  • By written submissions or witness statements.

In the ordinary course of events, a witness statement is filed in advance of the hearing for each witness who will give evidence. The statement provides an overview of the witness's personal details and the relevant facts in their testimony.

The FTT can require a witness to testify and provide evidence under oath. Witness testimony can only concern fact. Any opinion evidence is usually inadmissible, unless the witness is called as an expert witness.

Each party's witness statements are exchanged in accordance with the directions issued by the FTT. The parties can agree that the witness statements stand as evidence on their own, in which case the witness does not need to be called to present oral evidence. Where a witness statement is not accepted and either party wishes to cross-examine a witness, that party can request that the witness attends the hearing.

The FTT can issue witness summonses and require any person to answer questions or produce documents within their possession or control.

Criminal law

In the normal course, the advocate appearing for the prosecution will deliver an opening speech, following which each witness will be called to give evidence and then to be cross-examined by the defendant's representative. Re-examination is permitted after cross-examination.

Witnesses of fact can be required by either the prosecution or defence to attend court and give oral evidence. If neither party requires a witness to attend, then the witness's statement can be read to the jury by the party calling that witness.

Judges should not seek to cross-examine any witness. However, a judge can ask questions for clarification.

Jurors sometimes ask questions to witnesses. This is done by the juror putting the question in writing. The question is then handed to the judge, who can ask the question to the witness provided that he or she deems it a proper and relevant question.

Witness preparation

21. Provide a brief outline of the procedure for preparing witnesses in both civil and criminal cases. Are there any special or unique features to consider for witness evidence in criminal cases?

Civil law

The preparation of the witness statement is an important exercise and its contents must be in accordance with the evidence that the witness proposes to give at the hearing. The witness must confirm that the contents of the statement are within his or her knowledge and correct, and usually signs a statement of truth. Where the witness relies on documentary evidence, the relevant documents must be disclosed and clearly identified. When the witness relies on information that does not fall within his or her own personal knowledge, he or she must explain the source of knowledge.

There are important restrictions that regulate the conduct of a solicitor towards witnesses. For example, solicitors cannot:

  • Make or offer to make payments that are dependent on a witness's evidence or the outcome of the case.

  • Call a witness whose evidence they know is untrue.

  • Attempt to influence at witness with regard to the contents of his or her statement, when taking a statement from that witness.

  • Tamper with evidence.

  • Persuade a witness to change his or her evidence.

Criminal law

The training or coaching of witnesses in criminal trials is forbidden. This rule minimises the risk that a witness tailor his or her evidence in light of what someone else has said and any unfounded perception that this may have happened. By contrast, a witness can be given guidance in preparing to give oral evidence. This can include familiarising a witness with the trial process and the court, but no attempt must be made to influence the evidence a witness can give.

Witnesses must not discuss their evidence with each other in advance of the trial. In practice, witnesses remain out of court until called to give evidence, so that each witness gives evidence in the absence of other witnesses.

Hearsay evidence in civil and criminal trials

22. Are there any rules concerning the introduction of hearsay evidence in civil and criminal trials?

Civil trials

There are a number of limited circumstances where hearsay evidence is admissible, including where either:

  • All the parties agree to the admission of hearsay evidence.

  • Admitting the evidence is in the interests of justice.

Hearsay evidence is also admissible under common law exceptions, which have been established and maintained by case law. These include public information that is contained in public records and concerns a public matter which is publicly available for reference.

Criminal trials

The rules concerning hearsay for criminal trials are the same as for civil trials (see above, Civil trials).


Expert evidence

Expert reports in civil trials

23. What are the rules concerning the introduction of expert reports in civil trials?

The First-tier Tribunal (FTT) can give directions regarding whether the parties are permitted or required to provide expert evidence. The FTT can also decide whether the parties must jointly appoint a single expert to provide evidence.

Expert evidence in civil trials

24. What are the rules concerning the introduction of expert evidence in civil trials?

Where a party intends to provide expert evidence, the usual practice is for that party to file an expert's report setting out the expert's expertise, experience, qualifications and opinion.

The First-tier Tribunal is not bound by the expert's evidence, regardless of how persuasive it may be. Each party can cross-examine the other party's expert. The overriding principle in determining whether expert evidence should be admitted is whether "it is helpful in assisting the court to reach a fully informed decision". Expert evidence, even if potentially of value to the court, can be excluded if it is not helpful because the issue is "one on which the court is able to come to a fully informed decision without hearing such evidence".

Expert evidence in criminal trials

25. What are the rules concerning the introduction of expert evidence in criminal trials? Is it possible to introduce expert reports?

Expert evidence

In criminal proceedings, the judge determines whether a witness is competent to give evidence as an expert. This depends on whether:

  • A person without instruction or experience in the area of knowledge would be able to form a sound judgement on the matter without the expert evidence.

  • The witness has acquired, through study or experience, sufficient knowledge of the subject to render his or her opinion of value in resolving the issues before the court.

An expert's first duty is to the court. An expert must give his or her evidence in an objective and unbiased manner within his or her area of expertise. The expert's duty includes obligations to:

  • Draw the court's attention to any questions the answers to which are outside his or her area(s) of expertise.

  • Inform all parties and the court if his or her opinion changes from that contained in a report served as evidence or given in a statement.

Expert reports

The Criminal Procedure Rules contain rules governing the introduction and service of expert reports, including that:

  • Expert reports must be served on the court and each party as soon as practicable, and in any event with any application in support of which that party relies on the evidence.

  • Notice must be given of anything that can reasonably be thought capable of detracting substantially from the credibility of an expert.

The other party must be given, on request, a copy of, or a reasonable opportunity to inspect a record of any underlying examination, test, and so on on which the expert's report is based.

Expert reports can be introduced as evidence provided that either:

  • The parties agree.

  • The party calling the evidence has complied with the relevant procedural rules.

Where the parties do not agree, a party cannot introduce an expert report in evidence if the expert does not give evidence in person.

Special considerations

26. Are there any special considerations for introducing expert evidence/reports in both civil and criminal trials?

Civil trials

See Question 24.

Criminal trials

See Question 25.


Closing the case in civil trials

27. What are the rules governing the submission of both written and oral argument in closing a civil trial?

If a case proceeds to a full hearing, the parties' respective positions will be put to the First-tier Tribunal (FTT) by the parties or their representatives. Before the case is heard, the parties must send a brief summary of their legal argument (known as a skeleton argument) to each other and the FTT.

The parties will usually make submissions after the FTT has heard the evidence. In practice, the appellant will make its submissions first, followed by HMRC. After this, the appellant may have the option to make further submissions in reply.


Closing the case in criminal trials

28. What are the rules governing the submission of both written and oral argument in closing a criminal trial?

After completion of the defence case, both the prosecution's advocate and the defendant's advocate will deliver a closing speech. Usually, the prosecution's advocate will deliver his speech first, followed by the defendant's advocate. Generally, the trial judge will then summarise the various issues of fact so that the jury can reach its verdict. The judge can also summarise the arguments for both sides.

In the Magistrates Court, the magistrate decides on issues of both fact and law and the prosecution's advocate is not entitled to make a closing speech. At the end of the trial, the defendant's advocate makes a closing speech and the magistrate will then retire to consider the verdict.


Decision, judgment or order

Civil law cases

29. What are the rules governing the issuance of a decision in civil cases?

The First-tier Tribunal (FTT) can give its decision orally at a hearing, or can reserve judgment and give its decision at a later date. The decision notice must state the FTT's decision and notify the parties of any right to appeal and the time limits for exercising such right. Unless the parties agree otherwise, the decision notice must also include a summary of the findings of fact and the reasons for the FTT's decision. This must be accompanied by full written findings of fact and reasons for the decision.

If full written reasons have not been provided, parties must apply for them before making an application to the FTT for permission to appeal.

The FTT is not a court of superior record. Its decisions do not form legal precedents that the FTT is bound to follow. However, although not legally binding, a previous decision can have a persuasive value for the FTT.

Criminal law cases

30. What are the rules governing the issuance of a decision in criminal cases?

In the Crown Court, the jury considers its verdict. All its deliberations must be private. If the verdict is not guilty, the defendant is free to leave the court. If a guilty verdict is reached, the judge can sentence the defendant immediately or, if necessary, adjourn the proceedings to enable pre-sentence reports to be prepared. A judge will give reasons setting out the basis for the sentence imposed.

In the Magistrates Court, the magistrate will decide on the verdict and the sentence and give reasons for his decision.



31. How is the issue of costs determined in both civil and criminal cases?

Civil law

Generally, proceedings in the First-tier Tribunal (FTT) are "costs neutral" and each party must pay its own legal costs. The FTT can only make an order in respect of costs in the following cases:

  • The conduct of a party's legal representative was improper, unreasonable or negligent and caused costs to be incurred for either side.

  • The FTT considers that a party or its representatives has acted unreasonably in bringing, defending or conducting the proceedings.

  • The case is complex and the taxpayer has not requested that the proceedings be excluded from potential liability for costs.

Whether interest is payable on the amount at stake will depend on whether it was claimed and whether there was a legal basis for such interest. In some cases, applicable legislation may provide for interest to be payable and computed on a simple (as opposed to a compound) basis.

Criminal law

In criminal proceedings, a court can make a costs order in favour of a party in various circumstances, but only if each party and any other person directly affected either is present or has had an opportunity to attend or to make representations.

In deciding on any costs order, the court must have regard to all the circumstances, including the conduct of all the parties and any costs order already made. If the court makes a costs order, it must identify the legislation under which the order is made. A costs order will usually be for an amount that is sufficient reasonably to compensate the recipient for costs actually, reasonably and properly incurred.



Right to appeal in civil law

32. What are the main grounds for appealing a civil law decision?

A party to a case in the First-tier Tribunal (FTT) has a right to appeal against the decision of the FTT to the Upper Tribunal. However, the appeal must be on a point of law, as the Upper Tribunal cannot reopen an examination of the facts of the case. There is a very limited exception to this principle where the facts found are "such that no person acting judicially and properly instructed as to the relevant law could have come to the determination under appeal", in which case the Upper Tribunal can re-examine the facts. The key question is whether, as a matter of law, the FTT was entitled to reach its conclusions. Procedure in the Upper Tribunal is governed by The Tribunal Procedure (Upper Tribunal) Rules 2008.

Procedure to appeal in civil law

33. What is the procedure for appealing a civil law decision?

Appeals to the Upper Tribunal

A party wishing to appeal against a decision of the First-tier Tribunal (FTT) must first apply to the FTT for permission to appeal, no later than 56 days from the date on which the FTT sends its decision.

If the FTT refuses permission, the applicant can seek leave to appeal from the Upper Tribunal, within one month from the date that the FTT first sent notice of its refusal. If any of these deadlines are missed, the Upper Tribunal has an overriding discretionary power to hear late appeals.

If the Upper Tribunal refuses permission to appeal, it must send written notice of the refusal and the reasons for the refusal to the appellant. If a refusal to grant permission to appeal is made by the Upper Tribunal without any hearing, the appellant can apply for this decision to be reconsidered at a hearing, provided that the application for a hearing is made within 14 days of the Upper Tribunal's original decision.

If the Upper Tribunal grants permission to appeal, it must send written notice to the relevant parties, including any limitations on the scope of the appeal. Court fees can be payable when lodging appeals, depending on the circumstances.

Further appeals

Appeals from the Upper Tribunal are heard by the Court of Appeal. Appeals from the Court of Appeal are heard by the Supreme Court.

A party can only appeal an Upper Tribunal decision on a point of law after seeking permission to appeal from the Upper Tribunal. Permission will not be granted unless either:

  • The appeal raises an important point of principle or practice.

  • There is some other compelling reason for the court to hear the appeal.

If a party wishes to appeal a decision of the Court of Appeal to the Supreme Court, it must first seek permission to apply from the Court of Appeal.

Unless the case involves matters of EU law or the European Convention on Human Rights, there is no further right of appeal against a Supreme Court decision.

Right to appeal in criminal law

34. What are the main grounds for appealing a criminal law decision?

A defendant can appeal to the Crown Court against a conviction or sentence imposed by a Magistrates Court, within 21 days of the decision. A defendant can appeal from the Crown Court to the Court of Appeal against a conviction or sentence, within 28 days of the decision.

Procedure to appeal in criminal law

35. What is the procedure for appealing a criminal law decision?

There is no requirement to seek leave to appeal against decisions of the Magistrates Court. In the Crown Court, the defendant will require either leave to appeal from the Court of Appeal or a certificate from the trial judge that the case is fit for appeal. The prosecution also has certain appeal rights, for example, where it is considered that the sentence was unduly lenient.

An appeal notice against sentence and/or conviction from a Magistrates Court to the Crown Count must be served not more than 21 days after the date of the decision(s) that the appellant seeks to appeal. This time limit can be extended in certain circumstances. The appeal notice must be in writing and contain certain specified details.

Notice of appeal or of an application for leave to appeal to the Court of Appeal from the Crown Court must be given within 28 days from the date of the conviction, verdict or finding sought to be appealed against or, in the case of a sentence, from the date on which the sentence was passed. This time limit can be extended in certain circumstances. The notice of appeal or application for leave to appeal must be in writing and must contain certain specified details.

Appeals from decisions of the Court of Appeal must be brought to the Supreme Court.


Recent civil law developments and proposals for reform

36. Outline the main recent civil law developments in tax litigation in your jurisdiction. Are there any proposals to reform civil law tax litigation?

HMRC is continuously expanding its powers to clamp down on tax evasions. Regarding individuals, the Finance Act 2015 introduced the power for HMRC to recover a tax debt directly from a taxpayer's bank account. Regarding corporates, the Finance Act 2015 introduced the Diverted Profits Tax Regime, which is designed to counter the use of aggressive tax planning techniques used by large corporates. The regime includes notification provisions that require corporates to notify HMRC and to provide information to HMRC about high risk transactions. These provisions have been introduced to supplement HMRC's normal information gathering powers.


Recent criminal law developments and proposals for reform

37. Outline the main recent criminal law developments in tax litigation in your jurisdiction. Are there any proposals to reform criminal law tax litigation?

The UK Government has recently concluded a consultation on the introduction of a corporate offence of failure to prevent the facilitation of tax evasion. A further consultation will be announced in early 2016. It is expected that the consultation will result in legislation during 2016/2017. This legislation is likely to be modelled on the Bribery Act 2010, which requires corporates to show that they have taken reasonable steps to prevent the facilitation of tax evasion.


Online resources

Tax Tribunals


Description. The Tax Tribunals website is maintained by the Tax Tribunal and contains official listings of cases, useful information and case law.

HM Revenue & Customs (HMRC)


Description. HMRC's official website contains contact details, new announcements, all relevant information relating to taxes in the UK and HMRC's manuals.

Official UK legislation


Description. The official UK legislation website contains up-to-date UK legislation, including taxes legislation.

Contributor profiles

Liesl Fichardt, Partner

Clifford Chance LLP

T +44 20 7006 2044
F +44 20 7006 5555

Professional qualifications. Solicitor and Solicitor Advocate, England and Wales

Areas of practice. Tax investigations and disputes, including complex tax investigations, large tax enquiries and negotiations with tax authorities; conducting cases in the Tax Tribunal, the courts of appeal and the Court of Justice of the European Union.

Professional associations/memberships.

  • Chair, British Branch of the International Fiscal Association.

  • International Taxes Committee, Law Society of England and Wales.

Judith Seddon, Partner

Clifford Chance LLP

T +44 20 7006 4820
F +44 20 7006 5555

Professional qualifications. Solicitor, England and Wales

Areas of practice. National and international white collar crime, fraud, corruption and regulatory enforcement investigations; advice to corporations and individuals facing criminal investigations and prosecutions, including advice on responding to dawn raids.

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