HMRC v Apollo Fuels: victory for tax payer in Upper Tribunal
Rory Mullan and Oliver Marre of Tax Chambers, 15 Old Square have successfully represented Apollo Fuels before the Upper Tribunal following HMRC’s appeal against the decision of the First-tier Tribunal. The Court held that there were no income tax or NICs payable on cars leased by an employer to its employees on arm’s length terms. Mrs Justice Rose had regard to the interaction between the earnings charge and benefits code. As the charge on a non-arm’s length lease on these terms would be general earnings and thereby excluded from the car benefit charge, it made no sense that an arm’s length lease created a charge within that charge. She also held that implicit exemption from the benefits code for fair bargains is not limited to situations within the residual charge in Chapter 10, Part 3 ITEPA. It is therefore also available in relation to the charge on cars, vans and related benefits in Chapter 6, Part 3 ITEPA. The full text of the judgement in HMRC v Apollo Fuels and Others and Brian Edwards and Others  UKUT 0095 (TCC) is available below. The text of the decision of the First-tier Tribunal is available here.