Tax Bites - October 2025

Welcome to the latest edition of RPC's Tax Bites – providing monthly bite-sized updates from the tax world.

News

HMRC has published Guidance on what to do if you owe money to HMRC

HMRC has published Guidance on the steps taxpayers should take if they owe tax or penalties. 

The online tool provides guidance, support, and information on:

• checking if a letter received from HMRC is genuine;
• getting extra support due to health or personal circumstances;
• making a payment;
• disagreeing with a tax decision or penalty;
• getting help with signing in to HMRC online services;
• what help is available if a taxpayer cannot pay their tax on time; and
• what will happen if a taxpayer does not pay their tax bill.

HMRC has published Guidance on reporting Pillar 2 Top-up Taxes in the UK 

HMRC has published Guidance explaining the reporting requirements for Pillar 2 Top-up Taxes in the UK (the Domestic Top-up Tax and Multinational Top-up Tax).

A group must register for Pillar 2 Top-up Taxes if it has:

• at least one entity located in the UK; and
• a consolidated group annual revenue of 750 million euros or more, in at least two of the previous four accounting periods. 

If these criteria are met, the group needs to register with the service regardless of whether any Top-up Tax is payable. 

Further practical guidance on registering to report Pillar 2 Top-up Taxes is available here. 

HMRC has published guidelines that assist in ensuring documents filed with HMRC are correct and complete

HMRC has published guidelines outlining what steps should be taken to ensure that documents submitted to HMRC are correct and complete. 

The guidelines can be found here and cover: 

• HMRC’s view on how to choose an interpretation of the law that is, on balance, most likely correct;
• the importance of all facts and views of the law being correct and complete to the best of a taxpayer's knowledge;
• recommended approaches when taking professional advice;
• help to resolve any remaining uncertainty;
• HMRC’s expectations of advisers; and
• practical examples of how to handle tax uncertainty.

HMRC has published Guidance and an online tool in respect of overpayment relief for Corporation Tax

HMRC has published Guidance and an on-line tool to assist taxpayers in deciding whether to apply for Corporation Tax overpayment relief.

The online tool enables taxpayers to ascertain if they should make a claim for Corporation Tax overpayment relief. It also outlines how to make a claim and explains reasons why a claim may not be successful. The time limit for making a claim is four years from the end of the relevant accounting period.

Case reports

Tribunal refuses HMRC permission to appeal to the Upper Tribunal against two case management decisions

In BGC Services Holdings LLP v HMRC [2025] UKFTT 700 (TC), the First-tier Tribunal (FTT) refused HMRC permission to appeal against its earlier decisions whereby it refused HMRC's application seeking further and better particulars from the taxpayer and granted the taxpayer's application that HMRC properly particularise its case.

Given HMRC's failure to provide reasons, it is surprising that HMRC sought further and better particulars from BGC and maintained this position in its application to the FTT for permission to appeal. HMRC are expected to make an application to the Upper Tribunal (UT), which was acknowledged by the FTT, for permission to appeal to the UT. It will be interesting to see whether HMRC proceed with such an application and if it does, whether it will receive a more sympathetic hearing before the UT. Given the circumstances, one would hope not.

You can read our commentary on the decision here.

Tribunal allows taxpayers’ appeals in principle private residence and trading dispute

In R Eyre and another v HMRC [2025] UKFTT 461 (TC), the FTT allowed the taxpayers' appeals against HMRC’s decision to assess income tax on the sale of a residential property. The FTT rejected HMRC’s argument that the transaction was an 'adventure in the nature of trade' and found that the property qualified for principal private residence (PPR) relief.

This decision provides useful guidance on two recurring issues in property tax cases, namely, whether a transaction amounts to trading and whether short-term occupation can attract PPR relief. The decision reinforces the principle that:

• PPR relief is available where a property is genuinely occupied as a main residence, even for a relatively short period of time; and
• the redevelopment and resale of a property, even at a substantial gain, does not necessarily imply the existence of a trade.

This case also highlights the importance of contemporaneous evidence demonstrating residential intention and use. It illustrates the challenges HMRC can face when attempting to re-characterise property transactions as income-generating trades. Taxpayers engaged in high-value property development or refurbishment should ensure that the nature of their use and intentions are well documented and consistent with their tax position.

You can read our commentary on the decision here.

Upper Tribunal allows taxpayers' appeals in EIS case

In Hugh Edward Mark Osmond and Matthew Charles Allen v HMRC [2025] UKUT 00183 (TCC), the UT allowed the taxpayers' appeals, concluding that the FTT had erred in law and that the main purpose of crystallising Enterprise Investment Scheme (EIS) relief was not the obtaining of an income tax advantage, even though this may have been its effect.

This decision has prevented HMRC from extending the scope of the Transactions in Securities regime beyond its intended purpose and reinforces the importance of examining a taxpayer's actual subjective intention - something the UT noted aligns with how practitioners have long understood the rules to operate.

The decision also serves as a reminder that taxpayers should clearly document their commercial intentions at the time the relevant transaction is entered into. It will be interesting to see if HMRC seek to appeal this decision to the Court of Appeal. 

You can read our commentary on the decision here.

And finally …

In collaboration with Temple Tax Chambers, our latest Tax Take webinar series explores the UK tax landscape and key considerations for professionals and business leaders seeking insights into the often-complex world of tax.

Through a series of webinars hosted by tax experts from RPC and Temple Tax Chambers, we will be exploring the following topics:

Research & Development tax reliefs | Thursday, 2 October, 1200–1300
Hosted by: Stephen Morse, Barrister at Temple Tax Chambers and Alexis Armitage, Senior Associate at RPC

HMRC's information powers | Wednesday, 5 November, 1200–1300
Hosted by: Keith Gordon, Barrister at Temple Tax Chambers and Daniel Williams, Associate at RPC

Register here