29 August 2024
Mainpay Ltd v HMRC: [2024] UKUT 00233 (TCC)
In Mainpay Ltd v HMRC, the Upper Tribunal dismissed an appeal from the First-tier Tax Tribunal brought by an umbrella company.
The company had reimbursed its workers’ travel expenses using benchmark scale rates and claimed they were deductible from the workers’ earnings because they were employed under a single overarching employment contract so that the workplace they attended for each separate assignment was a temporary workplace.
The Upper Tribunal upheld the FTT’s decision that the contract was not overarching but rather a framework agreement under which separate contracts for service in respect of each assignment were entered into. The expenses were for travel to and from a permanent workplace and were therefore not deductible. Nor was it open to the company to have used benchmark scale rates in the absence of an HMRC dispensation.
The UT also provided detailed clarification regarding what HMRC need to do to establish causation where it is alleged that a loss of tax has been brought about carelessly by a taxpayer.
Sadiya Choudhury KC acted for HMRC.
You can find a copy of the judgment here.
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