Apollo Belvedere Services LLP (In Liquidation) & Anor v The Commissioners for HMRC [2026] UKFTT 687 (TC)

[2026] UKFTT 00687 (TC)Case No TC 09880
FIRST-TIER TRIBUNAL
TAX CHAMBER
Date Judgment date: 11 May 2026
Appeal references: TC/2024/04041
TC/2025/03790
PROCEDURE – Application for substitution of party – Whether applicant has standing to appeal – Tribunal’s jurisdiction – Alternatively whether Applicant be added as a respondent to proceedings with consequential directions being made
Determined on the papers
Before
TRIBUNAL JUDGE BROOKS
Between
apollo belvedere services llp (in Liquidation)AppellantAMANDA STAVELEYAppellantTHE COMMISSIONERS FOR HIS MAJESTY’S REVENUE AND CUSTOMSRespondentDECISION

Introduction

[1]The First Appellant, Apollo Belvedere Services LLP (in liquidation) (the “LLP”), before being wound up on 11 September 2024, appealed against a closure notice, dated 2 November 2023 (the “Closure Notice”), issued by the Respondents (“HMRC”) under s 28B Taxes Management Act 1970 (“TMA”) amending the LLP’s 2008-09 tax return (the “LLP Return”). The amount of tax at stake is approximately £11.1m plus interest (the “LLP Appeal”).[2]The Second Appellant, Amanda Staveley, has appealed against a penalty, dated 14 September 2023 (the “Penalty”), issued to her pursuant to paragraph 20 of schedule 24 to the Finance Act 2007, as partner of the LLP on the basis that there was a deliberate inaccuracy in the LLP Return. The amount of penalty is approximately £6.4m (the “Penalty Appeal”).[3]By an application dated 20 February 2026 The application is actually dated 20 February 2025.This appears to be a typographical error (as it was received by the Tribunal as an attachment to correspondence dated 20 February 2026) and has been treated as such. (the “Application”), Ms Staveley seeks a direction that she be substituted for the LLP in relation to the LLP Appeal pursuant to rule 9(1)(b) of the Tribunal Procedure (First-tier Tribunal)(Tax Chamber) Rules 2009 (the “FTT Rules”).[4]Alternatively, Ms Staveley seeks a direction that either she be added as a Respondent to the LLP Appeal pursuant to rule 9(2) FTT Rules, or, that the LLP Appeal be stayed pending the outcome of the Penalty Appeal and that, in either case, the Tribunal makes a direction prohibiting the liquidators of the LLP from withdrawing the LLP Appeal or being dissolved without its permission.[5]In a letter of 13 March 2026 the Tribunal (Judge Brown KC), set out its initial view that the Application “correctly sets out the legal position on substitution and for the reasons stated Ms Staveley has the right to be substituted without the consent of [the LLP]”, directed:(1) All directions concerning the general case management of this appeal are suspended.(2) No later than 7 days from the date of this letter, the liquidators and HMRC should make any representations on the Application. Any such representations must address the legal basis on which the application is resisted in accordance with the overriding objective.(3) If no representations are received within the directed time frame from either the liquidators and/or HMRC the Application will be granted, Ms Staveley will be substituted as the Appellant in [the LLP’s] appeal and the directions dated 21 November 2025 will be reinstated with new compliance dates such that the amended grounds of appeal will be required to be served no later than 14 days from the date of this letter.(4) If representations are received the Appellant shall be entitled to respond to the representations and must do so within 14 days for the date of this letter.(5) No reminders will be issued.(6) Shortly after 14 days from the date of this letter (and assuming that direction 3 does not apply) a judge will determine the Application and make appropriate directions.[6]HMRC, after being granted an extension to do so, made written representations in response to the Application on 26 March 2026. Ms Staveley through her counsel, Mr Samuel Brodsky, replied in writing to HMRC’s representations on 13 April 2026.[7]The liquidators did not avail themselves of the opportunity to make representations within the time stated in the above directions or at all.

Background

[8]The substantive dispute concerns an issue of whether a payment made on 29 April 2009, pursuant to a written agreement dated 27 April 2009, is taxable in 2008-09.[9]Ms Staveley contends that the payment falls to be taxed in 2009-10 (when she and the LLP were non-resident) and that in any event the payment was her personal income, not that of the LLP. HMRC contend that the payment was income of the LLP which falls to be taxed in 2008-09.[10]Ms Staveley was one of the LLP’s two partners during 2008-09, the other being Mr Craig Eadie. It is agreed that Ms Staveley was the nominated partner and the sole partner entitled to income in 2009-09. HMRC have not sought to issue a penalty to any other person.[11]If the Tribunal were to confirm the Closure Notice in the LLP Appeal, HMRC will issue Ms Staveley with a Notice under s 28B(4) TMA rendering her personally liable for the entirety of the tax. There is no statutory right of appeal against a s 28B(4) TMA Notice and any challenge must be made by way of judicial review.[12]However, as the LLP is currently in liquidation the decision whether or not to pursue the LLP Appeal rests with the liquidators and not Ms Staveley. Because there is a possibility that the LLP Appeal could be withdrawn – the Application states that this has been “explicitly threatened by (some of) the liquidators unless a payment is made to them” – Ms Staveley has made the Application to ensure that she had the ability to challenge the Closure Notice effectively at the Tribunal without the risk of the liquidators withdrawing the LLP Appeal or demanding payment from her.[13]The Application would not have been necessary if Ms Staveley had been able to reach agreement with the liquidators for her to have conduct of the LLP Appeal. However, it has not been possible to agree terms. In an email of 28 January 2026, two of the liquidators have stated that they would only grant Ms Staveley conduct of the LLP Appeal if she paid their time charges and agreed, inter alia, to “a full indemnity of all the Joint Liquidators’ and their representatives’ costs, damages, claims, expenses, and other liabilities that may be suffered or incurred by any of them, to include those already incurred and any yet to be incurred,”

FTT Rules

[14]The relevant part of rule 9 of the FTT Rules provides: Substitution and addition of parties(1) The Tribunal may give a direction substituting a party if— (a) …; or (b) the substitution has become necessary because of a change in circumstances since the start of proceedings.(2) The Tribunal may give a direction adding a person to the proceedings as a respondent. … (5) If the Tribunal gives a direction under paragraph (1) or (2) it may give such consequential directions as it considers appropriate.

Discussion and Conclusion

[15]There is a general consensus that the Tribunal in this case has the power to direct that Ms Staveley, who has a clear interest in the outcome of the appeal, be added to the proceedings as a respondent, indeed HMRC do not object to a direction in such terms.[16]At first blush such a direction, the first alternative direction sought by Ms Staveley, may seem an obvious and straightforward solution. However, that is not the case. This is because HMRC have raised an issue as to the scope of the Tribunal’s authority to make a direction prohibiting the liquidators from dissolving the LLP without its permission and have questioned the position if the LLP was dissolved, and therefore ceased to exist, given that in Wimpole Interiors Ltd v HMRC [2014] UKFTT 424 (TC) at [15] the Tribunal (Judge Redston and Mr McBride) held that it “has no jurisdiction to hear a case when the appellant is no longer in existence.”[17]As such, it is necessary to consider the Application as a whole, addressing the following issues:(1) Whether the Tribunal has the jurisdiction to substitute Ms Staveley for the LLP (the “Primary Application”); and, if not,(2) Whether, if Ms Staveley is added as a respondent, under rule 9(2) FTT Rules, the Tribunal may make a direction prohibiting the liquidators from withdrawing the LLP Appeal or being dissolved without its permission.

Primary Application

[18]Clearly there has been a change of circumstances since the start of proceedings, namely the liquidation of the LLP.[19]Ms Staveley contends that as a result of that change, and given the real possibility of the LLP Appeal being withdrawn by the liquidators, a substitution of the LLP is necessary and that, as the only party with a financial interest in the outcome of the LLP appeal, she is the natural person to be a party in place of the LLP. She further contends that, as the nominated partner, she herself has a right of appeal against the Closure Notice (see s 28B(8) TMA) and that this is consistent with HMRC’s guidance. Moreover, she says that her substitution as appellant causes no prejudice to any party and allows the dispute to be resolved without procedural hurdles and her having to pay money to a third party to access justice.[20]In their response to the Application HMRC state that “at the outset” they believe that:
“… Ms. Staveley should be entitled to advance her case in relation to the LLP Appeal and HMRC do not wish to prevent her from doing so. However, it is important that the appeals are managed consistently with the FTT’s jurisdiction and the statutory regime which governs appeals against closure notices issued under s 28B TMA 1970.”
[21]Accordingly, HMRC contend that Ms Staveley cannot be substituted for the LLP because she does not have standing to be an appellant in relation to the LLP Appeal in her personal capacity as an individual member of the LLP.[22]In order to be substituted as an appellant in an appeal, a person must have standing to pursue the appeal which is before the Tribunal (see MCashback Software 6 LLP v HMRC [2013] UKFTT 679 (TC) (“MCashback 6”) at [51]–[52]).[23]Although s 31 TMA provides a right to appeal against a closure notice issued under s 28B TMA, it does not identify who has standing to appeal against a s 28B TMA closure notice.[24]Ms Staveley contends that as the nominated partner she has a right of appeal and that this is consistent with HMRC’s published guidance and the decisions of the Tribunal in MCashback 6 at [88]; Phillips v HMRC [2009] UKFTT 335 (TC) at [106], Gibbs v HMRC [2013] UKFTT 236 (TC) at [46] and Batten v HMRC [2025] 1538 (TC) (“Batten”) at [64] – [66], in which HMRC accepted that all individual partners had a right of appeal on the basis of having a sufficient interest in making an appeal.[25]The issue of whether an individual partner had the right to appeal was considered in Knibbs v HMRC [2019] EWCA Civ 1719 (“Knibbs”). Although Knibbs concerned the position in relation to traditional partnerships rather than limited liability partnerships which were created as a new form of legal entity – a body corporate with a legal personality separate from its members - by the Limited Liability Partnerships Act 2000 (as in the present case), s 863 Income Tax (Trading and Other Income) Act 2005 provides that for income tax purposes, the activities of a limited liability partnership are treated as carried on by its members in partnership with each other (and not by the limited liability partnership), provided that the limited liability partnership carried on a trade, profession or business with a view to profit. Section 1273 of the Corporation Tax Act 2009 provides for the same in respect of corporation tax.[26]In Knibbs, David Richards LJ (as he then was) giving the judgment of the Court of Appeal said, at [23]:
“As earlier noted, many of the claimants participated in the tax schemes through partnerships. In those cases, HMRC have opened or intend to open enquiries into the partnership returns under s 12AC. Giving notice of enquiry is deemed to include the giving of notice of enquiry under s 9A to each partner who has made a return: s 12AC(6). Upon completion of the enquiry, HMRC issue a closure notice to the partnership and, if the partnership return is amended by the closure notice, HMRC must give each partner a notice amending the partner’s return: s 28B(4). The partnership can appeal against the conclusions in or amendments made by the closure notice, but the individual partners have neither that right nor a right to appeal the notice given to them under s 28B(4).”
[27]Although the Tribunal decisions cited by Ms Staveley do not appear to have been cited to the Court of Appeal in Knibbs (nor was Knibbs cited to the Tribunal in the subsequent case of Batten), it should be noted that none of these decisions were binding on the Court of Appeal. However, the converse is true, the decision in Knibbs is binding on the Tribunal even if contrary to HMRC’s guidance (which does not have the force of law).[28]It must therefore follow, as HMRC contend, that an individual partner does not have a personal right of appeal against a s 28B TMA closure notice, but that, as a partnership may appeal against such a notice, an individual partner may only appeal as a representative of the partnership.[29]In the present case, given the relationship between Ms Staveley and the liquidators (see paragraphs 12 and 13, above), it is clear that she is not acting as a representative of the LLP but in her personal capacity. As such, because she does not have standing to pursue the LLP Appeal in her personal capacity, Ms Staveley cannot be substituted for the LLP in the LLP Appeal.[30]However, this does not prevent Ms Staveley from being added to the proceedings as a respondent under rule 9(2) FTT Rules.

Direction prohibiting withdrawal and/or dissolution

[31]Ms Staveley contends that if she is added to the proceedings as a respondent, she is vulnerable to the liquidators withdrawing the LLP Appeal and/or dissolving the LLP unless there are directions prohibiting them from doing so. She says the liquidators, who did not avail themselves of the opportunity to make representations on the Application, would not be prejudiced by such directions as they accept they have no interest in the proceedings and will not be liable for costs under an agreement she has made with HMRC that HMRC will not seek any costs from the liquidators in the event that the LLP Appeal is dismissed.[32]She says that the Tribunal is able to make such directions under its case management powers contained in rule 5 FTT Rules. Rule 5(1) provides that subject to the provisions of the Tribunals, Courts and Enforcement Act 2007 and any other enactment, the Tribunal may regulate its own procedure. As noted in the Application, there is no statutory provision preventing a direction of this kind. Further, rule 9(5) FTT Rules specifically provides that, if a party is added as a respondent or substituted as appellant, the Tribunal may make such consequential directions as it considers appropriate (see paragraph 14, above).[33]As noted above (at paragraph 16), HMRC have questioned whether the Tribunal has the power to make a direction prohibiting the liquidators from dissolving the LLP without its permission. However, HMRC have neither provided any reasoned objection nor positively opposed such a direction being made under rule 5 FTT Rules.[34]Having given the matter careful thought, I have come to the conclusion that, in the absence of any authority, statutory or otherwise, precluding the Tribunal from doing so, the Tribunal, which has the power to require a non-party to provide documents, information or submissions (see rule 5(3)(d) FTT Rules) does have the power to make a direction precluding the liquidators from dissolving the LLP without its permission.[35]In relation to a direction precluding the withdrawal of the LLP Appeal, rule 17 FTT Rules (insofar as relevant to the present case) provides: Withdrawal(1) Subject to any provision in an enactment relating to withdrawal or settlement of particular proceedings, a party may give notice to the Tribunal of the withdrawal of the case made by it in the Tribunal proceedings, or any part of that case— (a) by sending or delivering to the Tribunal a written notice of withdrawal; or (b) orally at a hearing.(2) The Tribunal must notify each party in writing of its receipt of a withdrawal under this rule. …[36]HMRC contend that as the LLP cannot unilaterally withdraw the LLP Appeal under rule 17 FTT Rules, a direction precluding it from doing so without permission is unnecessary. In support, they cite the observation of the Upper Tribunal (Bacon J and Judge Raghavan) in R (Fluid System Technologies (Scotland) Limited) v HMRC [2025] UKUT 278 (TCC) (“Fluid Systems”) at [24(12)] that:
“Once an appeal has been made by the taxpayer (whether to HMRC alone or notified to the FTT) the taxpayer cannot unilaterally withdraw that appeal; rather, pursuant to s 54(4) TMA 1970, HMRC can indicate that it is unwilling for the appeal to be withdrawn.”
[37]At paragraph 31 of the response to the Application it is stated:
“HMRC hereby confirms that, unless there is a material change in circumstances, HMRC would object to any purported withdrawal of the LLP Appeal by the LLP.”
(emphasis as stated in the response)[38]Ms Staveley contends that the Tribunal may make a direction prohibiting the withdrawal of the LLP Appeal under the Tribunal’s case management powers in rule 5 FTT Rules and the power to make consequential directions in rule 9(5) FTT Rules.[39]Notwithstanding HMRC’s assurance that they would object to any attempted withdrawal of the LLP Appeal, I consider that such a direction would ensure that the liquidators understood that the LLP Appeal could not be withdrawn without the permission of the Tribunal. Such a direction would also be a more efficient use of the Tribunal’s and parties’ time as it would avoid the need for further litigation resulting from a purported withdrawal of the LLP Appeal and HMRC’s objection to it.[40]Therefore, for the reasons above, I consider that Ms Staveley should be added to the proceedings as a respondent under rule 9(2) FTT Rules and directions made prohibiting the LLP (ie the liquidators) from withdrawing the LLP Appeal or the LLP being dissolved without the Tribunal’s permission.[41]I therefore make the following directions:

Directions

[42]It is Directed that:(1) The Second Appellant, Amanda Staveley be added as a respondent to these proceedings under rule 9(2) FTT Rules.(2) The First Appellant, the LLP, shall not withdraw its appeal or be dissolved without the permission of the Tribunal.(3) The Directions, endorsed by the Tribunal (Judge Snelders) on 21 November 2025 as amended (the “Directions”) be reinstated and the Appellants shall comply with Direction 3 (amended ground of appeal) of the Directions by no later than 28 days from the date hereof, with all subsequent time limits being extended accordingly.(4) Liberty to apply.

Right to apply for permission to appeal

[43]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: 11 May 2026