The appellant, City Plant Ltd, sought permission to place a late appeal against an assessment for landfill tax for £1,673,701 issued by HMRC on 2 October 2012.

The appeal concerned whether City Plant should be granted permission to bring its appeal more than seven years after the expiry of the period set out in section 54G of Finance Act 1996.

Introduced in FA 1996, landfill tax applies to all waste disposed at a licensed landfill site, unless the waste is specifically exempt.

Following a review of City Plant’s landfill tax returns, HMRC discovered a high proportion of exempt and lower-rated waste declared when compared to standard-rated waste.

The tax authority determined that disposals described in City Plant’s schedule of waste materials as ‘screening fines’ had been wrongly declared at the lower rate of landfill tax.

On 28 September 2012, HMRC assessed City Plant for unpaid landfill tax for the accounting periods ending July 2011 to July 2012. The assessment letter notified City Plant of its right to review and appeal, and the applicable 30-day deadline.

Later, on 8 January 2012, City Plant’s representatives at KPMG requested a review of the decision. It was agreed that enforcement action would be suspended pending the outcome of the review.

Following a meeting between HMRC and City Plant, together with KPMG, the appellants said that they emerged from the meeting ‘confident that they had persuaded HMRC of their case’.

However, HMRC said that there was ‘no acceptance’ by them of City Plant’s position in respect of the assessment, and no agreement to withdraw it.

HMRC argued that for the first and second periods, 2013-2018, their suspension of enforcement action did not justify City Plant not filing an appeal. The assessment was at all times stated to be in force.

In the third period, enforcement proceedings related to December 2018 and July 2020, HMRC said that the appellant was also not justified in not filing an appeal against the tax debt.

It made reference to s54G of the Finance Act 1996, which provides that an appeal must be brought within 30 days of the date of the document notifying the decision. Thus, HMRC considered that the further delay of one year and six months was both serious and significant by itself.

In defence, City Plant argued that the initial cause of the delay in appealing was the ‘uncertainty’ created by HMRC.

City Plant’s understanding was that, following a meeting on 20 May 2013, there was an acceptance by HMRC that the company’s position concerning the assessment was justified and correct.

They argued that HMRC appeared to do nothing surrounding the assessment until December 2018, nearly four and a half years later, when they started enforcement and winding up procedures.

The enforcement action had come ‘out of the blue’ and they considered that the matter had been resolved for some time.

In the FTT, the tribunal approached the appeal using the three-stop approach in Martland and held that the appellant failed to submit the necessary approach in its appeal.

Judge Mark Baldwin said: ‘The assessment should have been appealed by 4 May 2013. It took City Plant until 28 July 2020 to file its initial, defective appeal notice and until 15 October 2020 to file a valid notice of appeal. That delay is very substantial and very serious.

‘Turning to the reasons for the delay, I accept that there was, at least until August 2014, some ongoing discussion between City Plant and HMRC about the merits of City Plant’s position. KPMG submitted a report in January 2013, there was a “high level” meeting in May 2013 and subsequent correspondence.

‘KPMG forwarded this to City Plant explaining that it was not an acceptable position and that it should be challenged accordingly. No such challenge appears to have been made.

‘City Plant’s delay in giving notice of appeal was very significant and serious, and nothing drawn to my attention has amounted to anything approaching a good reason for that delay.

‘I am not satisfied that City Plant’s case is compelling. If anything, based on the points discussed before me, it appears to be rather weak.’