Former Selborne Chambers head Romie Tager QC will likely see his £1.25m tax penalty cut following a judgment in the Upper Tribunal on Monday (14 December).
Judge Colin Bishopp imposed the penalty in March, ruling on a case brought by HM Revenue & Customs (HMRC). Tager faced penalties of £75,000 for his “failure to comply with two income tax notices” and £1.17m “for his failure to comply with the inheritance tax information notice”.
However in today’s ruling Bishopp said HMRC’s “assessment of the tax at risk as it is recorded in my decision released following the October 2014 hearing is incorrect and that the arithmetical assessment of the amount of the penalty is in consequence also incorrect”.
Bishopp conceded “there is an acknowledged error in the decision” over the amount Tager owes to the revenue and the amount will be “reconsidered”.
Tager instructed Withers tax investigations head Maurice Martin and partner Amber Melville-Brown in the aftermath of the March judgment to bring the application having previously represented himself at all prior hearings. Withers instructed Gray’s Inn Tax Chambers junior Hui Ling McCarthy.
HMRC general counsel Gill Aitken instructed Pump Court Tax Chambers’ David Yates.
A statement by Martin to The Lawyer read: ”We welcome the Upper Tribunal’s judgment and its recognition that the initial assessment of the amount in question was wrong. Until HMRC and BDO have reached an agreement on the tax on which the penalty is to be calculated, we believe that any estimation of the penalty is premature and indeed that it is likely to be substantially less than originally decided.”
The dispute stemmed from a cheque sent to HMRC by Tager’s accountants in 2006, one year after the death of his father Osias Tager, said to be on account of the inheritance tax due. Bishopp previously criticised the silk saying “no explanation of the calculation of that amount was offered” and calling his inaction over the subsequent tax notices “reckless”.
In Monday’s ruling, Bishopp said: “It does seem to me that there is a means by which the error may be addressed without the necessity of an appeal. It lies in the fact that I have not finally determined the original [HMRC] application”. He added the application problem “requires me to revisit the assessment of the tax at risk and arrive, if I can, at the correct amount”.
The judge added he would not agree with Tager’s counsel’s assertion that the barrister’s conduct amounted to “carelessness”.
“I do not see how a persistent failure to deal with information noticed can be so characterised; even if it was attributable in this case to Mr Tager’s inability to face up to reality rather than to a deliberate and considered refusal to cooperate, his conduct is far removed from a simple failure to take proper care,” he said.
Bishopp concluded that Tager “does accept that his compliance with the inheritance tax notice was both late and incomplete and that he was in breach of his undertaking relating to that notice”.
“Instead I suggested at the July hearing, and Mr Tager agreed, that he should adopt a certain course of action,” the judge added. This course of action is not to be “publicly disclosed”.
“It is, I think, sufficient to record that I am satisfied that what he is to do will be burdensome and that it represents sufficient recognition of the gravity of his behaviour for which, it should be remembered, he is also to suffer a substantial financial penalty.”
The legal line-up
For the claimant, HMRC
Pump Court’s David Yates, instructed by HMRC general counsel Gill Aitken
For the defendant, Romie Tager QC
Gray’s Inn Tax Chambers’ Hui Ling McCarthy, instructed by Withers partner Amber Melville-Brown