Robin Houldsworth v The Commissioners for HMRC [2026] UKFTT 1165 (TC)

[2026] UKFTT 01165 (TC)

Case No TC 09984

FIRST-TIER TRIBUNAL

TAX CHAMBER

Hearing Heard on: 13 May 2026

Date Judgment date: 13 August 2026

Taylor House, London

Appeal reference: TC/2020/00432

Tax residence dispute – application to stay tax proceedings to allow judicial review to proceed first – application refused

Before

TRIBUNAL JUDGE JUDITH HARRISON

Between

MR ROBIN HOULDSWORTHAppellant

THE COMMISSIONERS FOR HIS MAJESTY’S REVENUE AND CUSTOMSRespondent

Miss Riya Bhatt of Counsel for Appellant

Mr Bayo Randle and Mr Sam Way of Counsel for Respondents

DECISION

Introduction

[1]On 27 October 2025, the Appellant (Mr Houldsworth) appealed to stay his appeal to the Tribunal (the (“Tax Appeal”) pending the outcome of a related judicial review claim (the “Judicial Review”).

[2]The Respondents (HMRC) have objected to staying the Tax Appeal and have applied to the High Court to stay the Judicial Review pending the outcome of the Tax Appeal. During the hearing, the Tribunal directed both parties to share with the Tribunal any ruling or update received from the High Court in respect of the Judicial Review. No such update or ruling has been shared, such that the Tribunal understands that to date the High Court has not taken any decision in respect of the application to stay the Judicial Review.

[3]Both parties confirmed that, in their view, it would be undesirable for both the Tax Appeal and the Judicial Review to proceed in parallel, due to the significant overlap in the factual basis underpinning both proceedings.

[4]The Tribunal does not have the power to stay the Judicial Review, such that the only question for this Tribunal is whether to stay the Tax Appeal.

[5]The background to this appeal is that:(a) On 8 June 2018, HMRC issued a closure notice to Mr Houldsworth concluding that he was resident in the UK during the year ended 5 April 2005 (the “Relevant Tax Year”), and therefore chargeable to tax in the UK on certain dividends.The amount of dividends brought into charge by the closure notice is £1,309,500 and the additional tax is £323,528.32.

(b) Mr Houldsworth appealed the closure notice to the Tribunal. The Notice of Appeal was dated 22 January 2020 and was therefore out of time, but HMRC did not object to the late appeal so the Tax Appeal have continued. Mr Houldsworth’s grounds of appeal (as amended) comprised three grounds of appeal: (i) Ground 1: no valid closure notice had been issued under section 8A Taxes Management Act 1970. (ii) Ground 2: Mr Houldsworth was not tax resident in the UK as a matter of law. (iii) Ground 3: even if Mr Houldsworth were tax resident in the UK as a matter of law, Mr Houldsworth had a legitimate expectation that in assessing whether he was non-UK resident for tax purposes during the Relevant Tax Year, HMRC would adhere to the terms of their published guidance in paragraph 2.2 of the Respondents' publication IR20.

(d) On 13 March 2024, following an application made by HMRC, the Tribunal struck out Mr Houldsworth appeal to the extent it related to Ground 3 (legitimate expectation) (Robin Houldsworth v HMRC (

[2024] UKFTT 224 (TC)

(e) Mr Houldsworth is continuing the Tax Appeal relying on Ground 2, namely that he was not UK tax resident during the Relevant Tax Year.

(f) On 4 November 2025 Mr Houldsworth was granted permission by the High Court to bring the Judicial Review out of time on the following three grounds (see The King (on the application of Robin Houldsworth) v HMRC

[2025] EWHC 2848

): (i) Mr Houldsworth had a legitimate expectation that the guidance in IR20 would be applied to his circumstances in the relevant year and this legitimate expectation was breached by HMRC. (ii) HMRC’s refusal to apply the guidance in IR20 was unreasonable. (iii) HMRC’s refusal to apply the guidance in IR20 was an abuse of power. HMRC did not attend the permission hearing, and no directions were made by the High Court in respect of the interaction of the Tax Appeal and the Judicial Review. The papers provided by Mr Houldsworth to the High Court state that he intends to apply for permission to stay the Tax Appeal, if permission for the Judicial Review was granted. The decision of the High Court does not make any reference to whether the Tax Appeal or the Judicial Review should proceed first. The Tribunal was told that both parties are awaiting directions from the High Court in relation to the Judicial Review. In addition, HMRC has applied to stay the Judicial Review.

[6]The Tribunal was assisted by a hearing bundle of 186 pages, an authorities bundle of 649 pages, a skeleton argument prepared by Mr Houldsworth of 14 pages and a skeleton argument prepared by HMRC of 10 pages. In addition both Mr Houldsworth and HMRC provided the Tribunal with draft directions which they requested that the Tribunal issue to the parties following the publication of this decision.

The Facts

[7]The Facts There are a number of factual issues which have not been agreed between the parties. To provide some context for the discussion that follows, the factual dispute can briefly be described as:

Mr Houldsworth’s position

[8]Mr Houldsworth’s position In support of the argument that Mr Houldsworth was not resident in the UK in the Relevant Tax Year, Mr Houldsworth has explained (in the reply to HMRC’s objection to staying the Tax Appeal) the factual position as follows:(a) He left the UK on 2 April 2004 to take up full-time employment for an initial period of at least three years (note the amended grounds of appeal state that he left the UK on 1 April 2004). His new job was based in Switzerland, and required regular travel to Asia, Europe and North America.

(b) He was replaced in his former UK based role by two directors who remained in place for a number of years.

(c) He remained a director of a number of UK companies during the Relevant Tax Year; those appointments were a function of, and incidental to, his new employment. In that regard he spent no more than 10 working days deployed on those activities in the Relevant Tax Year and, in general, did so remotely.

(d) Mr Houldsworth had a Swiss Residency Permit and was resident in Switzerland for tax purposes. He had a fully-furnished Swiss apartment. He had a Swiss bank account, Swiss lawyers and Swiss medical registrations.

(e) He was paid his salary and his discretionary bonus in Swiss francs.

(f) Mr Houldsworth retained his London house. When he visited London he stayed either at his London house or with a friend. Mr Houldsworth friends and girlfriend stayed in his London house without him from time to time.

(g) Mr Houldsworth spent 76 days in the UK during the Relevant Tax Year.

(h) Mr Houldsworth was forced to return to live in the UK because of the impact that his employment abroad had had on his relationship with his then girlfriend, she lived in the UK and was later his wife.

[9]The Tribunal understands that it is accepted by both parties that Mr Houldsworth returned permanently to the UK on 19 April 2005; he resigned from his Swiss employment.

HMRC's position

[10]HMRC's position HMRC explained that in their objection to allowing the Judicial Review to be brought out of time that:(a) Prior to the Relevant Tax Year, having been born and always lived in the UK, Mr Houldsworth had been resident and ordinarily resident in the UK for tax purposes.

(b) On 1 April 2004 Mr Houldsworth travelled to France.

(d) Between 5 April and 13 April 2004, he was in Africa for a holiday.

(e) No evidence has been provided to show that Mr Houldsworth carried out any employment related duties between 1 April 2004 and 12 April 2004, such that HMRC’s position is that the evidence suggests that Mr Houldsworth commenced his contract of employment in Switzerland on 13 April 2004.

(f) During the Relevant Tax Year, Mr Houldsworth was in Switzerland for 16 full days and 39 part days.

(g) During the Relevant Tax Year, Mr Houldsworth was in the UK for 76 full days and 164 part days. He made 85 separate journeys to the UK.

(h) Mr Houldsworth retained his London home and kept his car in the UK.

(i) Mr Houldsworth took a suitcase of personal items to Switzerland. His remaining possessions remained in the UK.

(j) Of the nine UK group companies in which he was a director and which predated the new employment contract and continued throughout and beyond the Relevant Tax Year, four of those appointments were made on 15 March 2004 just before he signed the employment contract. There were five UK companies in which he was a director which were unconnected with the group companies and those directorships continued beyond the employment contract. He was Chairman and CEO of at least two companies. No evidence had been produced to substantiate that his duties as director were incidental to his new job. The legal framework Tribunal rules

The legal framework

[11]The Tribunal has power under Rule 5(3)(j) of the Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009 to stay the Tax Appeal.

[12]This power is discretionary and must be exercised in accordance with the overriding objective in Rule 2 of the Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009. The relevant parts of Rule 2 state that:

“(1) The overriding objective of these Rules is to enable the Tribunal to deal with cases fairly and justly. (2) Dealing with a case fairly and justly includes— (a) dealing with the case in ways which are proportionate to the importance of the case, the complexity of the issues, the anticipated costs and the resources of the parties; (b) avoiding unnecessary formality and seeking flexibility in the proceedings; (c) ensuring, so far as practicable, that the parties are able to participate fully in the proceedings; (d) using any special expertise of the Tribunal effectively; and (e) avoiding delay, so far as compatible with proper consideration of the issues.”

Case law on staying proceedings

[13]Where there are overlapping issues in concurrent proceedings, the ordinary course is that one of the matters should be stayed. In HT & Co (Drinks) Ltd v HMRC

[2015] UKFTT 663 (TC)

Judge Berner stated:

“The cases indicate that as a matter of principle, first, proceedings in which the same issues or questions fall in substance to be determined should not be permitted to proceed in parallel. Secondly, in principle proceedings in one court should not be determined if there is a realistic prospect that the matter decided would be moot, because the issue would become immaterial as a consequence of a decision of another court. Finally, those principles are founded upon the interests of justice, which will therefore fall to be applied in any case where the question whether to adjourn or stay is not determined as a matter of principle”

[14]There is no hard and fast rule to determine whether the Tax Appeal or the Judicial Review should go first, such that the appropriate course must be determined on a case by case basis (Daniel v HMRC

[2012] EWCA Civ 1741

(“Daniel”) at paragraph 12).

[15]HMRC v RBS Deutschland Holdings GmbH

[2007] STC 814

(“RBS Deutschland”) (Court of Session) held that the correct approach when determining whether a stay should be granted is to consider(a) whether the decision in the other appeal will be of “material assistance” in resolving the issues before the tribunal in question, and

(b) whether it is expedient to stay the appeal.

[16]In R. (on the application of Davies) v HMRC (

[2008] EWCA Civ 933

) (“Davies”) the Court of Appeal considered it appropriate for judicial review to take place before the tax appeal. The substantive tax issue in Davies was whether the taxpayers were UK resident, and if they were whether they had a legitimate expectation based on IR20 or HMRC’s practice that they should be treated as non-resident. Although it appeared to the court that there was “at least some dispute of primary fact”, the taxpayer told the court he was not seeking any finding of fact or hearing of oral evidence as part of the judicial review. Whilst the Court of Appeal considered that it is normally good practice for judicial review to be mounted on the basis of known facts, such that a judicial review claim would normally be postponed until those facts were found by the relevant specialist tribunal. However, there is an exception that general rule that the specialist tribunal proceedings go first where such proceedings would pre-empt or raise an obstacle to the judicial review claim. In that case, it was appropriate for the application for judicial review to be heard first. In reaching that conclusion, the Court of Appeal said (see paragraphs 17 to 19 and 21):

“17. I am, however, in the end persuaded that the judicial review claim, assuming for the moment that it may be well-founded, would be pre-empted or have raised to it significant obstacles if the Special Commissioners hearing precedes it. 18. Very shortly, my reasons are these. First, there is a line of authority which suggests that legitimate expectation cannot be maintained if it would involve requiring the Revenue to act ultra vires its statutory duty to collect in the tax due. Of course it is true that the cases show that the Revenue has discretionary management powers; of course it is true the cases show that those powers include, or may include, forgoing particular tax in the interests of collecting the generality efficiently. For that, see for example R v Inland Revenue Commissioners ex parte MFK Underwriting Agents Ltd [1990] 1 WLR 1545 and R v Inland Revenue Commissioners ex parte Preston [1985] 1 AC 835. It does not, however, seem to me that it follows from that proposition that the Revenue would not be held to be acting ultra vires if it declined to collect tax which the Special Commissioners had, in effect, ruled was due. For the same reasons I do not think it possible to be confident that the Administrative Court would feel able, notwithstanding what Miss Simler has said to us, to direct the Revenue not either to claim or to collect tax which is effectively due under a decision of the Special Commissioners. In short, it seems to me that Mr Goldberg's proposition that if the Special Commissioners are against the claimants, their legitimate expectation would have become illegitimate, raises a serious obstacle to the subsequent conduct of a judicial review claim. 19. Secondly, whilst I think for my part that it is likely that an incidental determination by the Special Commissioners of the primary fact when full-time employment began would indeed inform any judicial review application, I am not convinced that a determination whether the claimants had left would not pre-empt the judicial review claim given the centrality of the question of leaving to the issue determined by the Commissioners: whether the claimants are resident or not. … 21. I ought to record that Mr Goldberg told us that he does not seek, in the course of the judicial review proceedings, any finding of fact nor any hearing of oral evidence. In saying that the judicial review application should, on the particular facts of this case, go first, I make it clear that I do not contemplate any determination of any issue of fact being appropriate to the proceedings in the Administrative Court.”

[17]The decision in Davies was distinguished by the High Court in R. (on the application of Lower Mill Estate Ltd) v HMRC

[2008] EWHC 2409 (Admin)

(“Lower Mill Estate”). In Lower Mill Estate, the judicial claim was stayed pending the VAT Tribunal appeal, as in the circumstances the judicial review would not undermined by the VAT appeal. In taking this decision, Blake J acknowledged that the normal course would be for the facts to be decided by the statutory appeal before judicial review is invoked. In concluding that the tax appeal should proceed first, the High Court stated: “21. Therefore, upon the start of this case being called on I invited the counsel to address me again on the question of whether, now permission has been granted, the hearing of this application should be stayed so this court would have the advantage of relevant findings of fact. Mr Peacock QC submitted, as had been submitted before Goldring J, that really the principle in Davies was engaged in exactly the same way in this case as it had been in that case. He recognised that he could not rely upon facts for the proposition that wherever there is a statutory right of appeal, and a claim of legitimate expectation made by the claimants, that they should not be vulnerable to paying tax, and that the judicial review must always come first regardless of the circumstance. As I indicated, that does not seem to be the Court of Appeal's approach. 22. I have to say, looking simply at the decision in Davies, I am a little perplexed as to what it was that the Court of Appeal thought that the Revenue may not have had power to do, thus preventing the doctrine of legitimate expectation being engaged, even if the taxpayer was proven ultimately to be liable to tax. As I read the authorities, and as indeed I read Mr Sheldon's statement way back in 1978, the whole doctrine of legitimate expectation is of benefit, and only real value, where, on a true understanding of the facts and the law, the taxpayer is, or may well be, liable to tax. Despite that, however, it would be oppressive or unjust, or a conspicuous abuse of power, to require him, or her, to pay the tax because the conduct of the tax authorities, in the exercise of their management of powers, has legitimately created the belief that tax would not be payable for a particular period, for a particular reason. 23. It seems to me apparent, first, that the Revenue do have the power, in the exercise of their management of the tax statutes, to give indications or rulings as to whether or not a VAT invoice should be rendered at all, and at what rate the tax should be charged upon that invoice; whereas Davies was a case about income tax and capital gains for a period of alleged residence, and the issue is whether the taxpayer was a true resident in the UK at that particular period of time.29. Whatever the basis for distinction, I am satisfied that in this case the exceptional course promoted, as a result of the successful interlocutory appeal in Davies, does not destroy the legitimate basis of any case which the claimants may have, to return to this court to uphold a claim of expectation if their primary submission as to whether tax is payable is unsuccessful on appeal.

30. I reach that conclusion, first, because of the fact that this is a case of alleged express representation made to the taxpayer about what they should put into their invoices, rather than general reliance upon a guidance leaflet. Secondly, because the context is Value Added Tax and the requirement of rendering the invoice to a third party, if a standard rate tax was indeed due, as a result of the historic events needed to be clarified at the outset. That is a difference from the issues in Davies.

31. Thirdly, the law of legitimate expectation, in my judgment, precisely applies when it would be unfair to enable the Revenue to collect, or enforce, the collection of taxes where they have given such a specific representation to the contrary. That cannot be defeated by merely a confirmation of that which is implicit by reliance upon legitimate expectation, namely that but for the representation the tax would otherwise be due. It would empty the Sheldon statement, and the subsequent case law of legitimate expectation, of much of its utility, if that were the case.

32. Fourthly, I am wholly satisfied that the Revenue did have power to give the rulings, which the claimants say were given in this case, and, for reasons already explained, they really had to give some guidance on this scheme in order for the taxpayer to set up the appropriate invoicing arrangements a long time ago. This is not simply a case of representation in writing and orally, but also by what happened over the lengthy period from 1999 to 2007 when business was being conducted in accordance with what the claimant said were unambiguous representations. 33 Finally, the findings of fact in the statutory appeal, far from destroying the efficacy of the judicial review, such fact finding may very well be decisive as to whether there was an expectation at all, rather than whether an expectation, that once existed on the facts, could be enforced in the face of an adverse tax ruling. I make no further penetration of the disputed facts in this case. It seems to me that both sides had points to make as to the nature of these transactions, whether or not it came within the Halifax doctrine, and whether, even if it did, the whole point about rulings is it that they give protection against unforeseen changes in the law with retrospective effect. All those matters will be assisted once the court is aware of what the true nature of the transactions are and were, and that, in my judgment, is critical to knowing whether there has been sufficient disclosure to engage the doctrine in the first place. Without that the court would be moving somewhat blindly in a sensitive field of public law administration. 34. This is not a case, perhaps contrast to Davies, where it is simply a debate about whether the guidance notes from the Revenue were so clear and conclusive as to be a complete answer to liability on a freestanding basis. Here expectation and legitimacy of any expectation, and the primary facts as to the nature of these transactions, are all intimately bound up. I conclude, therefore, that notwithstanding the particular decision in Davies, this is not a case where judicial review would be rendered nugatory by adjourning the application, and every other indication in the case is that that is the most sensible and appropriate course to adopt. I therefore do so.” ….

[18]In R (Hankinson) v HMRC

[2009] EWHC 1774 (Admin)

(“Hankinson”), Kenneth Parker QC sitting as a Deputy Judge of the High Court recognised in similar concurrent proceedings relating to IR20 that it was necessary for the proper facts to be determined in the statutory appeal before the claim for judicial review could be heard. At paragraph 12 he stated: “it is essential that the fact of full-time employment abroad is established by the applicant, either as a finding by the tribunal hearing the case or by agreement. That is a condition on qualification laid down by IR20”.

[19]Lord Wilson in the Supreme Court in R. (on the application of Davies and Gaines-Cooper) v HMRC

[2011] UKSC 47

(“Davies/ Gaines-Cooper”) (the judicial review case involving, among others, the taxpayers in Davies) considered the Court of Appeal in Davies correctly ordered the judicial review to be heard first, on the basis that if the judicial review was successful this would remove the need for the tax appeal, and the investment of time needed to determine the tax appeal. The Supreme Court did not make any reference to Lower Mill Estate in its decision. In paragraph 4 Lord Wilson stated that:

“There was a dispute as to whether their application or their appeal should first be determined. On 10 July 2008 the Court of Appeal, in my view correctly and irrespective of its reasoning, ruled that the application should first be determined and it therefore remitted to the Administrative Court the question whether permission to apply for judicial review should be granted. The appeal of the first appellants to the commissioners has been stayed pending determination of the present proceedings.”

[20]However, in Daniel v HMRC

[2012] EWCA Civ 1741

(“Daniel”) the Court of Appeal considered that it was preferable for the tax appeal to be heard first. Daniel involved two appeals - a tax appeal where the taxpayer contended he was not UK tax resident, and a judicial review where he contended that he has a legitimate expectation that HMRC would apply paragraph 2.2 of IR20 to his case. The court confirmed the decision of Judge Bishop and was influenced by the fact that a successful appeal was more likely to achieve finality.

[21]In reaching his decision in Daniel, Judge Bishop (who was sitting as both a judge of the First-tier Tribunal and the Upper Tribunal) noted that:

“I was referred by both parties to observations of the Court of Appeal and the Supreme Court in R (Davies) v Revenue and Customs Commissioners and R (Gaines-Cooper) v Revenue and Customs Commissioners ([2010] STC 860 and [2011] STC 2249 respectively) about the sequence in which hearings should take place in cases of this kind. It does not seem to me that any of the judges was seeking to lay down a hard and fast rule. There will inevitably be some cases in which there is no dispute about any relevant fact, and others in which the facts are hotly disputed, and yet more in between. The appropriate course must inevitably be determined on a case-by-case basis. Assuming permission to seek judicial review is to be granted (a topic with which I shall deal shortly) I have come to the conclusion that the appropriate course in this case is for the tax appeal to be heard first. I am not unmindful of Mr Coppel’s [the taxpayer’s representative] argument that a judicial review hearing would be shorter, which I am sure is correct provided there is no significant dispute about the facts. But I am persuaded that there is a significant factual dispute, which the Upper Tribunal will be unwilling to resolve itself, and that there is in consequence a real risk that, if I adopted Mr Coppel’s preferred course, the Upper Tribunal would either be embarrassed by a factual dispute, or, having taken greater stock of its scale than I am able to do in the context of this application, feel obliged to revisit the order of proceeding and direct after all that the tax appeal should be heard first. There would be substantial wasted costs. I recognise that there are cogent arguments on both sides, but in balancing them on a pragmatic basis I am satisfied that the scales fall in favour of disposing of the tax appeal first.”

[22]The Court of Appeal in Daniel at paragraphs 22 and 23 said that:

“22 There is an underlying factual dispute between the taxpayer and HMRC which can only be conclusively resolved by the First tier Tribunal. Proceeding first with the judicial review claim risks delay and the ultimately fruitless expenditure of costs. The statutory appeal has the potential finally to resolve the dispute concerning the taxpayer’s residence status for the relevant year, and thus his liability to pay further tax. It was these reasons which persuaded me that it is appropriate that the judicial review claim should be stayed whilst the statutory appeal proceeds to a determination. 23. This was also the course taken by Kenneth Parker QC, as he then was, sitting as a Deputy High Court Judge in R (On the application of Hankinson) v Revenue and Customs Commissioners [2009] STC 2158 . In giving his decision he observed:– “In the judicial review proceedings it is essential that the fact of full-time employment abroad is established by the applicant, either as a finding by the tribunal hearing the case or by agreement. That is a condition on qualification laid down by IR 20. At present, according to the papers before me, HMRC are not agreeing that fact.”

IR20

[23]IR20 is a booklet of HMRC guidance. A revised version of IR20 was published in 1999 and remained operative until 2009.

[24]The relevant sections of this booklet (paragraphs 2.2 and 2.3) of IR20 stated:

“If you leave the UK to work full-time abroad under a contract of employment, you are treated as not resident and not ordinarily resident if you meet all the following conditions - your absence from the UK and your employment abroad both last for at least a whole tax year - during your absence any visits you make to the UK - total less than 183 days in any tax year, and - average less than 91 days a tax year. (The average is taken over the period of absence up to a maximum of four years - see paragraph 2.10. Any days spent in the UK because of exceptional circumstances beyond your control, for example the illness of yourself or a member of your immediate family, are not normally counted for this purpose.) If you meet all the conditions in paragraph 2.2, you are treated as not resident and not ordinarily resident in the UK from the day after you leave the UK to the day before you return to the UK at the end of your employment abroad. You are treated as coming to the UK permanently on the day you return from your employment abroad and as resident and ordinarily resident from that date. …”

The parties’ positions

[25]Mr Houldsworth submits that the Tribunal should exercise its case management powers under rule 5(3)(j) to stay the Tax Appeal until final resolution of the Judicial Review on the basis that:(a) The outcome of the Judicial Review would provide material assistance to the Tax Proceedings in two ways. The first is that even if Mr Houldsworth were to be unsuccessful in the Judicial Review, the High Court would necessarily make findings of fact in the course of the Judicial Review, and these findings of fact would materially assist the Tribunal. The second is that if Mr Houldsworth succeeded in the Judicial Review, the Tax Appeal would not need to continue.

(b) It would be expedient to stay the Tax Appeal, as the factual dispute relating to the Judicial Review is narrower than that relating to the Tax Appeal. As a result, it would be more efficient and cost-effective o allow the Judicial Review to be determined first. This is because the Tax Appeal will require the Tribunal to conduct a multi-factorial analysis of whether Mr Houldsworth made a distinct break with the UK, whereas the Judicial Review will only require consideration of the more limited factual tests in IR20.

(c) Mr Houldsworth also submits that if the Tax Appeal were to proceed first, and he were unsuccessful in the Tax Appeal, the High Court would then need to hear the Judicial Review.

(d) The approach of staying the Tax Appeal behind the Judicial Review was preferred by the Supreme Court in Gaines-Cooper on the basis that if the judicial review succeeded then the Special Commissioners would have unnecessarily invested a large amount of time on the substantive appeal.

(e) The High Court granted permission to bring the Judicial Review knowing that the Tax Appeal were ongoing and, on the understanding, (from Mr Houldsworth’s skeleton argument in respect of the judicial review renewal permission hearing appeal) that Mr Houldsworth would be asking to stay the Tax Appeal if permission was granted. Therefore, the principle of judicial comity requires the Tribunal to stay the Tax Appeal to allow the Judicial Review to proceed first.

[26]HMRC submit that the Tribunal should refuse to stay the Tax Appeal on that basis that:(a) There is a substantial overlap between the factual issues arising in the Tax Appeal and those arising in the Judicial Review. Both proceedings require examination of the Appellant's activities, intentions, employment arrangements, presence in Switzerland, and continuing links with the UK.

(b) The Judicial Review cannot properly be determined without resolution of disputed facts central to the residence issue. The Tribunal is the appropriate forum in which those facts should be determined.

(c) Relying on Lower Mill Estate, Hankinson and Daniel, where there are material disputes of fact, the ordinary course is for the statutory appeal to proceed first and for the judicial review proceedings to await those findings.

(d) Mr Houldworth’s reliance on Gaines-Cooper is misplaced because, unlike the present case, that litigation did not involve unresolved factual disputes of the kind that arise here. he majority of the Supreme Court held that this was not sufficient to found a legitimate expectation without the multi-factorial analysis required by IR20 read as a whole (see paragraph 45).

(e) If Mr Houldsworth were to succeed in the Tax Appeal, the Judicial Review would cease. Even if Mr Houldsworth succeeded in the Judicial Review, that would not necessarily resolve the underlying residence dispute. HMRC would be required to remake its decision, and there could still be a need for subsequent proceedings. By contrast, factual findings made by the Tribunal are capable of resolving or substantially narrowing the dispute between the parties, such that if the Tax Appeal were determined first, and HMRC were required to remake their decision, HMRC could rely on the Tribunal’s findings of fact to remake the decision.

(f) If the Tax Appeal is dealt with first, the High Court would be able to rely on the Tribunal’s findings of fact to determine the Judicial Review.

(g) HMRC submit that the overriding objective favours continuing with the appeal because the Tribunal possesses specialist expertise in determining residence disputes and because proceeding with the Tribunal appeal first avoids duplication of factual inquiries and the risk of inconsistent findings.

Decision

[27]The application is refused.

[28]The Tribunal's power to stay proceedings is discretionary and must be exercised in accordance with the overriding objective. The question is which forum should first determine the issues that lie at the heart of the dispute between these parties.

[29]The Tribunal starts from the position that there is no hard and fast rule which dictates whether a substantiative tax appeal or judicial review should proceed first.

[30]A key feature of this case which favours refusing the application is the existence of substantial disputed questions of fact. By contrast in Davies, in deciding that the judicial review should proceed first, the Court of Appeal proceeded on the basis that the claimant was not seeking factual findings or oral evidence in the judicial review proceedings. The Supreme Court approved this approach in Davies/ Gaines-Cooper. In the present case, by contrast, the disputed facts appear central to the Judicial Review grounds and neither party has suggested that those facts can simply be assumed or left unresolved. For example, the parties disagree when Mr Houldsworth starting his new employment, the degree of his continuing links with the UK (including the extent of his work in the UK) and the degree of his connection with Switzerland. In the view of this Tribunal, these factual questions are fundamental both to the Tax Appeal and to the Judicial Review. The Tribunal does not proceed on the basis that the High Court lacks jurisdiction to make findings of fact in judicial review proceedings where necessary. Rather, the relevant question is whether, in the circumstances of this case, those findings are more appropriately made in the specialist fact-finding jurisdiction of the First-tier Tribunal. Daniel, Hankinson and Lower Mill Estate, support the proposition that where substantial factual disputes exist, the specialist tribunal (here the Tribunal) is ordinarily the appropriate vehicle for determining them. Rule 2(d) (overriding objective) requires the Tribunal to use any of its specialist expertise effectively as part of dealing with a case fairly and justly. Of the authorities cited to the Tribunal, Daniel is the closest to the present case, involving both a residence appeal and a judicial review founded on paragraph 2.2 of IR20. The Tribunal therefore attaches particular weight to the reasoning of the Court of Appeal in that case.

[31]Mr Houldsworth submitted that the facts required to be determined to enable the Judicial Review relying on paragraph 2.2 of IR20 were much narrower than the facts required to determine the Tax Appeal, such that allowing the Judicial Review to proceed first would be less expensive, and the disparity between the parties’ resources was a factor in favour of granting the stay. When asked Mr Houldsworth was unable to provide the Tribunal with an estimate of the difference in cost or the days that would be needed to consider the Judicial Review compared to the Tax Appeal.

[32]The Relevant Tax Year pre-dates the introduction of the statutory residence test, as a result, the question of whether Mr Houldsworth was tax resident under UK domestic law in the Relevant Tax Year will depend upon whether he made a distinct break in the pattern of his life and will require a multi-factorial analysis. Mr Houldsworth does not appear to be arguing that if he were resident under UK domestic law, his residence status would be altered by the double taxation treaty between the UK and Switzerland.

[33]Mr Houldsworth submits that even if he was tax resident under UK domestic law, he should be treated as if he were non-UK resident provided he met the conditions in paragraph 2.2 of IR20, and that the tests in paragraph 2.2 are much narrower than the tests in domestic law and do not require a multifactorial enquiry. This is why Mr Houldsworth argues that the Judicial Review will be less costly. The Tribunal is not persuaded that the factual inquiries are as distinct as Mr Houldsworth suggests. Whether Mr Houldsworth left the United Kingdom to work full-time abroad, when that employment commenced, the extent of his continuing UK activities and the nature of his connections with Switzerland all appear capable of being relevant to both proceedings.

[34]The Tribunal accepts that where there is no significant factual dispute between the parties, judicial review will typically be shorter, and therefore less costly for the parties. However here there is a significant factual dispute between the parties and a significant overlap in the factual issues. The Tribunal is not persuaded that the factual inquiries are as distinct as the Appellant suggests. Whether the Appellant left the UK to work full-time abroad, when that employment commenced, the extent of his continuing UK activities and the nature of his connections with Switzerland appear capable of being relevant in both proceedings.

[35]The Tribunal also anticipates that the question of whether a multifactorial enquiry is needed to assess whether the conditions in paragraph 2.2 of IR20 are met may end up being argued as part of any Judicial Review. The Tribunal expresses no concluded view on that issue, which is not necessary for the purposes of determining the present application. Mr Houldsworth relied on paragraph 21 and 36 of Davies/Gaines-Cooper to establish that no multifactorial test was needed. However, paragraph 17 of Daniel indicates that paragraph 2.2 may require a multifactorial analysis. It is not necessary for the Tribunal to resolve whether a multifactorial analysis is required by paragraph 2.2, as regardless of whether a multifactorial analysis is needed, there are still substantial factual disputes between the parties (for example, when Mr Houldsworth’s duties began in Switzerland and the full-time nature of his employment abroad due to his UK duties).

[36]Mr Houldsworth submitted that Judicial Review would provide material assistance to the Tax Appeal. The Tribunal is not persuaded by this submission because the critical factual findings are likely to be made more fully and appropriately in the Tax Appeal itself. Any assistance therefore runs principally in the opposite direction.

[37]The Tribunal is not persuaded on the material before it that determination of the Tax Appeal first would pre-empt, or create a significant obstacle to, the continuing pursuit of the Judicial Review. The Tribunal does not consider that Davies compels a stay in the present case. The critical feature of Davies was the Court of Appeal's concern that determination of the tax appeal first might substantially prejudice the effectiveness of the judicial review claim. No comparable risk has been demonstrated here. Moreover, unlike Davies, the present proceedings involve substantial and central disputes of fact which are more appropriately determined in the specialist fact-finding jurisdiction of this Tribunal. The Tribunal therefore considers the present case to be closer to the circumstances considered in Lower Mill Estate, Hankinson and Daniel than to those considered in Davies.

[38]The Tribunal considers that if Mr Houldsworth were to succeed in the Tax Appeal, this would dispose of the need for a Judicial Review. Even if he were unsuccessful, the Tribunal's findings of fact are likely to provide material assistance to the High Court in determining any continuing Judicial Review proceedings. The Tribunal does not consider it necessary to determine whether success in the Judicial Review would finally resolve the dispute between the parties. However, the Tribunal is satisfied that determination of the Tax Appeal first has the greater potential either to resolve the dispute entirely or substantially narrow the issues remaining for determination. In those circumstances, the Tribunal considers that the balance of expediency favours allowing the Tax Appeal to proceed first.

[39]The Tribunal does not consider that the grant of permission in the Judicial Review requires a stay of the Tax Appeal on the basis of the principle of judicial comity.

[40]The principle of judicial comity was succinctly described by Judge Brown KC in the case (which was not cited by either party) of The Executors of the Estate of Linington and another v HMRC

[2023] UKFTT 89 (TC)

. She said, at paragraph 177:

"In summary, the principle requires that whilst courts of competent jurisdiction are not bound by the legal conclusions of one another's judgments, such conclusions will be highly persuasive and should be followed unless the second court is convinced that they are wrong. …"

[41]Permission was granted to allow the Judicial Review, but no direction was made by the High Court that deals with the sequencing of the Judicial Review and the Tax Appeal. Giving permission for judicial review is a question of whether there is an arguable case, not a question of case management between two courts. In the Tribunal’s view, a suggestion that a stay of the Tax Appeal will be applied for is not enough to engage the principle of judicial comity. The Tribunal does not accept that the grant of permission amounts to an implicit decision by the High Court as to the sequencing of the proceedings. Had the High Court intended to determine the issue of sequencing, it could have given express directions on that subject.

[42]The application for a stay is therefore refused.

[43]Standing back and considering the matter in the round, the Tribunal is satisfied that the balance falls clearly in favour of allowing the Tax Appeal to proceed. There are substantial disputed issues of fact which are common to both sets of proceedings; the Tribunal is the specialist forum best placed to determine those issues; the findings made in the Tax Appeal are likely to provide material assistance to the High Court if the Judicial Review continues; and determination of the Tax Appeal has the potential either to resolve the dispute entirely or significantly narrow the issues remaining between the parties. Conversely, the Tribunal is not persuaded that determination of the Judicial Review first would avoid the need for substantial factual investigation, nor that refusal of a stay would undermine the effectiveness of the Judicial Review. Applying the overriding objective and the guidance in RBS Deutschland, Lower Mill Estate, Hankinson and Daniel, the Tribunal concludes that it is both just and expedient for the Tax Appeal to proceed before the Judicial Review.

Right to apply for permission to appeal

[44]Right to apply for permission to appeal This document contains full findings of fact and reasons for the decision. Any party dissatisfied with this decision has a right to apply for permission to appeal against it pursuant to Rule 39 of the Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009. The application must be received by this Tribunal not later than 56 days after this decision is sent to that party. The parties are referred to “Guidance to accompany a Decision from the First-tier Tribunal (Tax Chamber)” which accompanies and forms part of this decision notice. Release date: 13 August 2026