GC v HMRC (TC) (Residence and presence conditions : ordinary residence) [2014] UKUT 251 (AAC)

UKUT-AAC
GC v HMRC (TC) (Residence and presence conditions : ordinary residence)
[2014] UKUT 251 (AAC) · 2014-05-30
[5]… Lewison J summarised a number of relevant factors in paragraph 3 of his judgment, and at the end of his judgment he referred back to, and described as impeccable, another list provided by Dr Brice in her decision in an earlier case about another airline pilot, Shepherd v HMRC (2005) SPC 00484, from which, as it happened, Lewison J had heard and dismissed an appeal: [2006] EWHC 1512 Ch.[6]Lewison J's summary is as follows:
"(i) The word "reside" is a familiar English word which means "to dwell permanently or for a considerable time, to have one's settled or usual abode, to live in or at a particular place": Levene v Commissioners of Inland Revenue (1928) 13 TC 486 , 505. This is the definition taken from the Oxford English Dictionary in 1928, and is still the definition in the current on-line edition; (ii) Physical presence in a particular place does not necessarily amount to residence in that place where, for example, a person's physical presence there is no more than a stop gap measure: Goodwin v Curtis (1998) 70 TC 478, 510; (iii) In considering whether a person's presence in a particular place amounts to residence there, one must consider the amount of time that he spends in that place, the nature of his presence there and his connection with that place: Commissioners of Inland Revenue v Zorab (1926) 11 TC 289 , 291; (iv) Residence in a place connotes some degree of permanence, some degree of continuity or some expectation of continuity: Fox v Stirk [1970] 2 QB 463, 477; Goodwin v Curtis (1998) 70 TC 478, 510; (v) However, short but regular periods of physical presence may amount to residence, especially if they stem from performance of a continuous obligation (such as business obligations) and the sequence of visits excludes the elements of chance and of occasion: Lysaght v Commissioners of Inland Revenue (1928) 13 TC 511 , 529; (vi) Although a person can have only one domicile at a time, he may simultaneously reside in more than one place, or in more than one country: Levene v Commissioners of Inland Revenue (1928) 13 TC 486 , 505; (vii) "
Ordinarily resident" refers to a person's abode in a particular place or country which he has adopted voluntarily and for settled purposes as part of the regular order of his life, whether of short or long duration: R v Barnet LBC ex p Shah [1983] 2 AC 309 , 343; (viii) Just as a person may be resident in two countries at the same time, he may be ordinarily resident in two countries at the same time: Re Norris (1888) 4 TLR 452; R v Barnet LBC ex p Shah [1983] 2 AC 309 , 342; (ix) It is wrong to conduct a search for the place where a person has his permanent base or centre adopted for general purposes; or, in other words to look for his "real home": R v Barnet LBC ex p Shah [1983] 2 AC 309 , 345 and 348; (x) There are only two respects in which a person's state of mind is relevant in determining ordinary residence. First, the residence must be voluntarily adopted; and second, there must be a degree of settled purpose: R v Barnet LBC ex p Shah [1983] 2 AC 309 , 344; (xi) Although residence must be voluntarily adopted, a residence dictated by the exigencies of business will count as voluntary residence: Lysaght v Commissioners of Inland Revenue (1928) 13 TC 511 , 535; (xii) The purpose, while settled, may be for a limited period; and the relevant purposes may include education, business or profession as well as a love of a place: R v Barnet LBC ex p Shah [1983] 2 AC 309 , 344; (xiii) Where a person has had his sole residence in the United Kingdom he is unlikely to be held to have ceased to reside in the United Kingdom (or to have "left" the United Kingdom) unless there has been a definite break in his pattern of life: Re Combe (1932) 17 TC 405 , 411." This has the incidental advantage of identifying almost all the decided cases to which I need to refer. Those not already mentioned to which I will refer are Re Young (1875) 1 TC 57, Cooper v Cadwalader (1904) 5 TC 101 and Commissioners of Inland Revenue v Brown (1926) 11 TC 292.[7]Dr Brice's list at paragraph 58 of her decision in Shepherd summarises the relevant factors in much the same way. Ignoring, as being less relevant, points which relate to ordinary residence, the following three items in her list are worth quoting, despite the overlap between the two lists:
"- that no duration is prescribed by statute and it is necessary to take into account all the facts of the case; the duration of an individual's presence in the United Kingdom and the regularity and frequency of visits are facts to be taken into account; also, birth, family and business ties, the nature of visits and the connections with this country, may all be relevant ( Zorab; Brown ); … that the availability of living accommodation in the United Kingdom is a factor to be borne in mind in deciding if a person is resident here ( Cooper ) (although that is subject to s 336); that the fact that an individual has a home elsewhere is of no consequence; a person may reside in two places but if one of those places is the United Kingdom he is chargeable to tax here ( Cooper and Levene) ;"
[8]As regards that last point, the proposition that a home elsewhere is of no consequence is not to be understood as meaning that the other home is entirely irrelevant to the necessary enquiry. That would be inconsistent with the obligation to take into account all the facts of the case. However, the existence of another home is not decisive, because of the possibility of simultaneous residence in several places. ”18. In the present case, it might be regarded as highly relevant that the claimant appears to have been returning to what was still a home of hers, where her children were living. What her intentions were and how settled they were are among the matters that remain to be explored, but her periods of physical presence in the United Kingdom were not by chance, even though short.19. I am not surprised that, on the information before him, the First-tier Tribunal judge considered the claimant’s case to be hopeless, but he knew nothing about her having been in the United Kingdom between August 2009 and July 2010 and so did not know that it was her case that she had not been physically absent from the United Kingdom for more than eight weeks at a time. Neither party had told him about that. Despite the claimant having referred to her previous appeal, HMRC appears to have made no effort to link the two cases or to put the information obtained in connection with that case before the First-tier Tribunal in the present case. Against the wider background of the claimant’s dealings with HMRC, HMRC’s response to her appeal to the First-tier Tribunal seems to me to have been grossly inadequate. Even worse was its so far unexplained failure to deal with the claimant’s first appeal. It is true that, by the date of the hearing, the claimant knew what information had been provided to the First-tier Tribunal in her current appeal and she could have provided more detail in support of her appeal in either of her applications for a postponement. On the other hand, she was applying for a postponement precisely so that she could explain her case in person and cannot, in my judgment, have been expected to realise that the judge would consider anything other than her reason for not being able to attend the hearing in order to do that.20. I am satisfied that the judge erred in considering the claimant’s appeal to be hopeless and that he would not have done so, or would have been wrong to have done so, had HMRC provided a proper response and also “copies of all documents relevant to the case in [HMRC’s] possession”, as required by rule 24(4)(b) of the Tribunal Procedure (First-tier Tribunal) (Social Entitlement Chamber) Rules 2008 (SI 2008/2685). The First-tier Tribunal judge was entitled to believe he had all such documents before him and he plainly did not. That procedural defect gave rise to unfairness, particularly in view of the fact that the claimant did not have representation. It seems doubtful that the judge would have refused the postponement had he not considered the appeal to be hopeless. For these reasons, I am satisfied that the First-tier Tribunal’s decision not to grant a postponement was wrong in law and that the subsequent decision to dismiss the claimant’s appeal was therefore also wrong in law. (Since the claimant has already been paid the arrears from 19 August 2011, I need not consider whether, since it accepted HMRC’s submissions, the First-tier Tribunal ought formally to have allowed the appeal to the extent of making an award to from 19 August 2011 or whether HMRC had in fact revised the decision under appeal so that the Fist-tier Tribunal did not need to do so.)21. I am also satisfied that, as I do not have all the relevant documentary material before me and as the appeal that is more likely to have that material included in the papers is already before the First-tier Tribunal, I should remit this case to be heard by the First-tier Tribunal with that other appeal.22. Finally, I should add that the claimant asked that I obtain copies of the record of the HMRC Helpline conversation between the claimant and “Stuart in Dundee” at about 7.30 pm on 25 June 2009 and also a copy of the TC60 (or possibly TC600) booklet in force from April 2009, which led her to believe that she would be entitled to working tax credit as long as she returned to the United Kingdom every 8 weeks. Complying with such advice cannot determine whether a person is or is not ordinarily resident in the United Kingdom but where there is an element of discretion or judgment, official advice can create a legitimate expectation that the discretion or judgement will be exercised in a particular way. Good administration requires that effect be given to such expectations if that is consistent with the law, particularly where a person has acted to his or her detriment on the basis of the advice. But it is important to look carefully at the terms of the advice in order to see whether it really did create an expectation and, if so, what could really properly be expected. It may turn out not be necessary, or it may turn out not be permissible, for the claimant to rely on the advice. On the other hand, it may be relevant and for that reason I direct HMRC to provide it to the First-tier Tribunal. Mark Rowland 30 May 2014

Cited in 1 later judgment