Preston Benson & Ors v The Commissioners for HMRC

This decision is in respect of a late application for wasted costs, made in August 2025 on behalf of the three appellants in respect of the four sets of Tribunal proceedings that were commenced in 2024 and concluded by March 2025.

The underlying proceedings in respect of which costs are sought, consisted of the following:

More detail concerning each of these proceedings is set out below. HMRC resist the costs application for a number of reasons, also detailed below, and seek to have the costs applications struck out.

For the reasons set out below:

At all relevant times, Mr Benson was the sole director of PLL and RL.

On 10 August 2023, HMRC issued a NOR to give security for PAYE and NICs to each of Mr Benson and PLL, and a NOR to give security for VAT to PLL. Neither Mr Benson nor PLL gave security as required by the NORs. Mr Benson and PLL continued trading in breach of the notices, and on an unknown date the CPS commenced criminal proceedings against both Mr Benson and PLL in respect of this trading.

On 19 March 2024, HMRC issued two NOR to give security to RL (one for VAT, and one for PAYE and NICs), and a NOR to Mr Benson to give security in respect of RL’s liability to PAYE and NICs. RL sought a review by HMRC of both NORs.

On 22 April 2024, Mr Benson and PLL appealed out of time to HMRC against the NORs in respect of PAYE and NICs that had been issued to them in August 2023. On 25 April 2024, HMRC refused to consider these appeals out of time as they considered no reasonable excuse for the delay in appealing had been provided.

On 24 May 2024, Mr Benson and PLL each made an application to the Tribunal seeking the Tribunal’s permission to make an appeal to HMRC out of time in respect of the PAYE and NICs NOR. These two applications were joined and, on 26 July 2024, the Tribunal issued Directions to enable both of these applications to proceed to a hearing at which the Tribunal would consider whether to grant an extension of time and so require HMRC to consider the late appeals that had been submitted.

On 7 June 2024, HMRC issued a review decision to RL in respect of the VAT NOR. On 13 June 2024, RL appealed to the Tribunal against this review decision and against the PAYE and NICs NOR it had received. In the absence of a review decision as regards the NOR to give security or PAYE and NICs, the Tribunal treated RL’s appeal in respect of the NOR to give security for PAYE and NICs as a late appeal. HMRC did not object to the lateness of this appeal by RL.

On 27 June 2024, the Tribunal issued Directions to progress RL’s appeal to substantive hearing.

On 29 July 2024, PLL made a late appeal to the Tribunal against the NOR for VAT issued on 10 August 2023. On 22 August 2024, HMRC objected to the lateness of this appeal by PLL.

On 23 August 2024, the Tribunal issued further directions that provided for HMRC’s objection against the lateness of the TC/2024/04241 to be heard at the same time as Mr Benson and PLL’s applications (to make a late appeal to HMRC) in TC/2024/03141 and TC/2024/04213 respectively.

On 27 August 2024, PLL went into administration.

On 28 August 2024, Mr Benson applied to the Tribunal requesting that the Tribunal decide the underlying substantive dispute at the same time as deciding the lateness application in TC/2024/03141. This application was refused by me, on the basis that the Tribunal was not at that stage seized of an appeal by Mr Benson against the NOR, and so the Tribunal did not have jurisdiction to decide the underlying substantive dispute.

On 29 August 2024, Mr Benson made an application to be added as a second appellant in RL’s substantive appeal on the basis that a NOR had been issued to him, as well as to RL, in respect of RL’s liability for PAYE and NICs. HMRC did not object. Although the Tribunal’s usual practice would have been to create a separate appeal for Mr Benson, so that such appeal could be joined to RL’s appeal, Judge Brooks allowed Mr Benson’s application to be added as second appellant to TC/2024/03455.

On 6 September 2024, the administrators for PLL withdrew both of the proceedings brought by PLL. This withdrawal was acknowledged by the Tribunal on 17 September 2024. This concluded TC/2024/04213 and TC/2024/04241.

On 27 September 2024, RL went into liquidation.

On 13 November 2024, the liquidators notified the Tribunal of their withdrawal of RL’s participation in TC/2024/03455.

On 18 November 2024, HMRC notified the Tribunal that in light of RL’s liquidation, they had decided to withdraw the NOR that had been issued to Mr Benson in respect of RL’s PAYE and NICs. (Mr Benson had been notified of this withdrawal of the NOR on 14 November 2024, the day after the liquidators’ withdrawal from proceedings.)

On 19 November 2024, the Tribunal acknowledged these withdrawals.

In acknowledging the withdrawals, the Tribunal erroneously sent a letter suggesting that TC/2024/03455 had been allowed.

The correct position is that RL’s appeal was dismissed, following the liquidators’ withdrawal.

As the underlying NOR issued to Mr Benson had been withdrawn by HMRC, the Tribunal should have notified the parties that the remainder of TC/2024/03455 was struck out on the basis the Tribunal no longer had jurisdiction.

Despite the errors in the Tribunal letter as to the way in which the Tribunal proceedings ended, I find it was clear to both parties that the proceedings in TC/2024/03455 had concluded.

Mr Benson and HMRC continued to comply with the Tribunal Directions to progress Mr Benson’s lateness application. A hearing of this application was listed for 2 December 2024. This was listed as an in-person hearing, in accordance with the request in Mr Benson’s Notice of Appeal.

On 7 November 2024, Mr Benson asked for this hearing to be postponed and for the hearing to be by video. HMRC objected to postponement, and the application for postponement was subsequently refused by Judge Snelders. However, the hearing was re-listed as a video hearing.

The hearing of Mr Benson’s application for permission to make a late appeal took place on 2 December 2024 before Judge Snelders and Member Gill Hunter.

On 10 March 2025, the Tribunal issued the panel’s full decision to the parties. Mr Benson was refused permission to make a late appeal to HMRC. That refusal concluded TC/2024/03141.

On 1 August 2025, the Tribunal received an “application for wasted costs” dated 31 July 2025. This application was filed by the agent (“Agent”) who had acted for Mr Benson (and for RL and PLL, until those companies became insolvent) in the Tribunal proceedings. The application was said to be made on behalf of all of Mr Benson, RL and PLL and made in respect of all four proceedings. The total amount sought was £71,663.60.

On 6 August 2025, a revised costs application was filed by the Agent to correct an error concerning the court in which the criminal proceedings had been commenced against Mr Benson and PLL.

On 17 September 2025, Judge Brooks directed HMRC to comment upon the costs applications.

On 30 September 2025, HMRC stated that they would object to the costs applications but asked the Tribunal to first resolve an issue regarding authority. HMRC noted that the Agent had no authority to act from either the liquidators of RL or the administrators of PLL. HMRC also suggested that renewed authority was required from Mr Benson given how long had passed since the conclusion of the Tribunal proceedings. At the same time HMRC also noted that there was no explanation for the lateness of the costs applications, and that (as there was reference in the application to the criminal proceedings) the Tribunal did not have jurisdiction to award costs incurred in respect of those criminal proceedings.

The Appellants were directed to respond to HMRC’s points. On 25 November 2025, the Agent noted that “authorisation is pending”. On 4 December 2025, the Agent provided signed authorisation from Mr Benson and the liquidators for RL. The Agent accepted that PLL did not wish to pursue a costs application.

On 19 December 2025, HMRC emailed the Tribunal. In this email HMRC noted that:

HMRC asked that Mr Benson and RL be asked to particularise which behaviour of HMRC in the Tribunal proceedings they said was unreasonable, or that the costs applications be struck out on the basis that they had no reasonable prospects of success.

On 23 December 2025, the Agent emailed a response to HMRC’s email. In this email the Agent submitted that:

The “schedule” attached to the Agent’s email was a further copy of “interim invoices” issued by the Agent to RL, PLL and Mr Benson, with accompanying spreadsheets.

On 7 January 2026, HMRC reiterated their previous points.

On 28 January 2026, Judge Williams directed that unless either party requested an oral hearing, the costs applications and HMRC’s application to strike out the costs applications would be decided at a paper hearing. Neither HMRC nor the Agent objected.

On 31 March 2026, Mr Benson emailed the Tribunal with his timeline (in part relating to PLL) and seven accompanying exhibits which also, in part, related to PLL. None of those exhibits relate to either TC/2024/03141 or TC/2024/03455.

The applications which the Tribunal received on 1 August 2025 were said to have been made on behalf of Mr Benson, RL and PLL in TC/2024/03141, TC/2024/03455, TC/2024/04213 and TC/2024/04241.

The agent subsequently stated that PLL’s administrators did not wish to continue its costs application. However, it is unclear that the Agent had authority at any stage to bring this application on behalf of PLL. As the Tribunal has not received any communication from PLL’s administrators to authorise a costs application in respect of TC/2024/04213 and T/2024/04241, that part of the costs application is now STRUCK OUT.

I consider the application made by Mr Benson and RL in respect of TC/2024/01314 and TC/2024/03455.

I start by setting out the relevant parts of Rule 10 of the Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009. The relevant part of Rule 10 provides:

HMRC have objected that these costs application are late, and that Mr Benson and RL have not given adequate reasons for their lateness.

When required to respond to HMRC’s objection relating to lateness, the Agent stated:

While the Agent is correct that the application is dated 31 July 2025, it was emailed to the Tribunal, and received by the Tribunal, on 1 August 2025. The Rules require the Tribunal to consider when the application was “made”, and in this case that is 1 August 2025.

In referring to “HMRC’s withdrawal” as having taken place on 1 May 2025, it appears that the Agent is referring to an event that took place outside of the Tribunal proceedings and that is not relevant to Rule 10. It is unclear what the Agent understood “the usual timeline” to be but, as paragraph 10(4) makes clear, an application for an order for costs may not be made later than 28 days after the date on which the Tribunal sends either notice of its decision or notice of a withdrawal.

In respect of the two proceedings brought by Mr Benson and/or RL:

That means that the application in respect of TC/2024/03141 is 116 days (or almost four months) late, and the application in respect of TC/2024/03455 is 227 days (or seven and half months) late. I do not agree that either of these periods is “minimal”.

As neither costs application was received within time, the Tribunal must first decide whether to admit either of the costs application for consideration out of time. It is only if either one or both of the costs applications are admitted out of time, that the Tribunal can move on to consider the substance of these costs applications.

Rule 5(3)(a) of the Tribunal Rules gives the Tribunal the power to extend the time to make an application, but the Tribunal must decide, in each case, whether it would be appropriate to do so given the particular circumstances of that case. When a party is late in undertaking any action, the onus of proof is upon that party to explain the reasons for their delay and to make the case for being given relief from their failure to comply with the relevant time limit.

The Upper Tribunal in Martland v HMRC [2018] UKUT 178 (TCC) set out what the First-tier Tribunal should consider when deciding whether an extension of time should be granted. The Upper Tribunal stated:

Applying Martland, the first stage is to calculate the length of the delay. As set out above, Mr Benson’s delay in TC/2024/03141 is 116 days, and the delay of both RL and Mr Benson in TC/2024/03455 is 227 days.

Both of those periods are considerably longer than the 28 days Parliament considered sufficient for a party to make a costs application. As was said by the Court of Appeal in paragraph 105 of the Secretary of State for the Home Department v SS (Congo) and others [2015] EWCA Civ 387:

The delays commented upon in the appeals before the Court of Appeal were of 24 days and of three months. A delay of either 116 days or of 227 days is both serious and significant.

The second stage is to establish why the delay occurred.

The Agent has stated that the delay occurred due to the complexity of the “three related cases”, the need to take instructions and the time taken to draft the application.

I do not consider that any of the reasons put forward by the Agent provide a good reason for any of the delay by Mr Benson or RL in making their costs applications. Spending time taking instructions and drafting an application is required in every application for costs where there is an agent instructed. In making a joint costs application, the interests of Mr Benson and the liquidators for RL were aligned so there is no reason why any interaction between them, or between either of them and the Agent, would have added particular delay. The matter on which the Agent needed to take instructions was a costs application, and that is not complicated. The underlying Tribunal proceedings (an application for permission to be relieved of the consequences of lateness, and challenges to the validity of NORs) are not complicated when viewed against the wide range of matters considered by the Tribunal. The substantive appeal by RL (and latter Mr Benson) was categorised by the Tribunal as Standard, and Mr Benson’s application for permission to make a late appeal was categorised as Basic. There is nothing cited by the Agent (or apparent from the Tribunal files) that suggests either the underlying Tribunal proceedings or the current costs applications have any special features that take them out of the ordinary.

Given the other comments made by the Agent to justify the delay, it is possible that the Agent was not aware of, or did not understand, Tribunal Rule 10. However, if that is the case, a professional representative’s ignorance or misunderstanding of the relevant procedural rules would also not be a good reason for the delay.

I conclude that neither Mr Benson nor RL has provided a good reason for any part of their delay.

The third stage is to weigh all relevant factors. At paragraph 45 of Martland the Upper Tribunal held:

In HMRC v Medpro Healthcare Limited [2026] EWCA Civ 14, the Court of Appeal held that it was permissible for the Upper Tribunal to give this guidance to this Tribunal, and that this guidance, as amplified by the Upper Tribunal in Katib v HMRC [2019] UKUT 0189 (TCC) was “entirely appropriate”.

In weighing the relevant factors, first I consider the prejudice that each party would suffer depending on whether I do, or do not, grant either Mr Benson and/or RL permission to make a late application for costs.

Looking first at the consequences if I refuse permission to make a costs application out of time; this would mean that both Mr Benson and RL would lose the opportunity to have their costs application decided by the Tribunal. I should not take into account the merits of the costs applications unless I conclude that those merits are either very strong or very weak, and I should not conduct an in-depth investigation in order to reach a conclusion about the merits. In this case, it is obvious that there are several issues with the costs applications made by Mr Benson and RL (set out in more detail below). Taking into account these issues, I consider there is very limited likelihood of either Mr Benson or RL being successful in their application to be awarded the costs they have incurred in the Tribunal proceedings. The weakness of their application also means that there is only very limited prejudice to Mr Benson and RL if they are not given permission to make their costs applications out of time.

Turning now to the consequences if I give permission to make a late application for costs: in this case HMRC would be required to respond in respect of Tribunal proceedings that they were entitled to consider resolved. That would involve HMRC spending further time and resources on this matter, at the expense of other appeals brought by other appellants. Granting an extension of time would cause prejudice to those Tribunal users who have respected the time limits prescribed in the Tribunal Rules, by stretching scarce Tribunal resources and increasing the likelihood of delays in the Tribunal system. Although the prejudice to HMRC is relatively limited in this case, I conclude that the prejudice to HMRC and other Tribunal users if permission is granted would be greater than the prejudice to Mr Benson and RL if permission is not granted.

As Martland and Medpro require, when weighing the factors I take into account the particular importance of statutory time limits being respected. There is public interest in finality, and I am required to pay regard to the importance of the need for litigation to be conducted efficiently and at proportionate cost, and for time limits to be respected.

I remind myself that my starting point is that “permission should not be granted unless [I am] satisfied on balance that it should be”, and that it is for an applicant to demonstrate that I should depart from that starting point.

Mr Benson and RL have not provided a good reason for any of their serious and significant delay. The obvious weakness of their costs application counts against Mr Benson and RL being given permission to make their application out of time. There is greater prejudice to HMRC and other Tribunal users if permission is given than the prejudice which Mr Benson and RL might suffer if permission is not given. Also, any prejudice that Mr Benson and RL do suffer is a consequence of their own failure to apply in good time. Taking all of the above matters into consideration, neither Mr Benson nor RL has demonstrated that it would be appropriate for me to grant them permission to make their application out of time. I have concluded that it is not in the interests of justice to grant an extension of time in this matter.

Therefore, Mr Benson and RL are both refused permission to make their costs applications out of time.

As permission has been refused, the costs applications are not admitted for consideration.

As the costs applications have not been admitted for consideration, it is not necessary for me to consider HMRC’s application that the costs applications should be struck out under Tribunal Rule 8(3)(c). However, I agree with HMRC that, if they had been admitted, there is no reasonable prospect of the costs applications brought by Mr Benson or RL succeeding.

The 4 June 2024 Practice Direction issued by the Senior President of Tribunals requires sufficient reasons to be given by this Tribunal but warns against excessively long decisions. Therefore, I do not set out what I would have decided if permission to make a late costs application had been granted. Instead, I set out only brief reasons on the substance of the Appellant’s application, sufficient only to better explain my assessment of the merits.

As HMRC noted, there are a number of issues with the substance of the costs applications filed on 1 August 2025.

The first issue is that it is unclear what type of costs order is being sought. Although the applications are stated to be an application for wasted costs, they are also expressed to be made under Tribunal Rule 10(1)(b). As can be seen from the wording of Rule 10 (set out above) an order for wasted costs is made under Rule 10(1)(a) whereas Rule 10(1)(b) provides for an order for costs against a party.

The onus is on Mr Benson and RL to make clear whether they are seeking an order for wasted costs (i.e. an order against a representative) or an order for costs against a party (i.e. HMRC) on the basis of what they say is HMRC’s unreasonable behaviour.

To the extent that Mr Benson and RL are seeking an order for wasted costs, under Rule 10(1)(a) then such application would fail. This is because:

Mr Benson and RL have not addressed any of these aspects in their costs application.

Mr Benson and RL have identified a number of acts or omissions that they consider constitute unreasonable conduct on the part of HMRC. HMRC’s conduct is summarised in the application as follows:

However, the detail provided in the applications makes clear that all but one of the acts or omissions detailed, happened outside of the Tribunal proceedings. Matters such as the decision by the CPS to initiate criminal proceedings, or decisions by HMRC that are several months either before the commencement, or after the conclusion, of the Tribunal proceedings are not relevant to the Tribunal’s consideration of HMRC’s defence or conduct of TC/2024/03141 or TC/2024/03455.

The only act identified which relates to any act or omission in the Tribunal proceedings is Mr Benson’s complaint that it was “manifestly unreasonable” for HMRC to have withdrawn the NOR issued to him in respect of RL’s liabilities (thus concluding TC/2024/03455) yet continued to defend TC/2024/03141 (which was his application to make a late appeal to HMRC in respect of the NOR issued in respect of PLL’s liabilities).

Mr Benson may believe that, once HMRC had withdrawn in TC/2024/03455, they should also have withdrawn from TC/2024/01314. However, the underlying NOR in TC/2024/01314 was in respect of PLL, not RL – the two companies are distinct entities. Also, Mr Benson does not seem to have recognised that the only issue in TC/2024/01314 was whether he should be given an extension of time to appeal to HMRC. It is highly unlikely that HMRC would be considered to have acted unreasonably by choosing not to withdraw from proceedings which they subsequently defend successfully.

The application fails to make the case that any of HMRC’s conduct in the Tribunal proceedings justifies a costs order being made against HMRC in respect of that conduct.

The amount of costs sought is £71,663.60. As HMRC note, this figure has not been updated by the Agent to distinguish between the costs said to have been incurred by PLL, and the costs said to have been incurred by Mr Benson and/or RL.

Despite being required by Rule 10(3)(b), Mr Benson and RL have not provided the Tribunal with a schedule of the costs that they say they incurred in the Tribunal proceedings. Instead, Mr Benson and RL have provided interim invoices (some of which are addressed to PLL) and spreadsheets which give no indication of what work was undertaken, the grade of the person undertaking the work, the person for whom that work was undertaken, or the proceedings in which that work was undertaken. The only invoice addressed to RL is dated 26 April 2024, even though that is much earlier than RL’s appeal to the Tribunal on 13 June 2024, and even predates the HMRC review decision which RL appealed.

In Patel v HMRC [2023] UKFTT 00128, Judge Alexsander gave extensive guidance on what was required in a compliant costs schedule. The costs applications filed by Mr Benson and RL do not follow that guidance and do not meet the requirements of Rule 10(3)(b). It is not possible to have any understanding from the interim invoices and spreadsheets provided, what costs RL or Mr Benson actually incurred in TC/2024/03141 and TC/2024/03455. It would be impossible for the Tribunal to make a summary assessment of costs.

In the absence of an appropriate schedule, even if Mr Benson and RL had been able to establish that there was unreasonable conduct on the part of HMRC in the Tribunal proceedings, and even if Mr Benson and RL had demonstrated that they incurred costs as a result of such unreasonable behaviour, it is entirely possible that the Tribunal would go on to refuse to make any order for costs. That is in line with the approach outlined in Fox v HMRC [2022] UKFTT 00138 where insufficient detail was provided in a schedule.

All of these issues make it extremely unlikely that Mr Benson and RL could be successful in their costs applications.

For the reasons set out above:

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.