Tax Bites - October 2026

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

News

HMRC publishes Guidance on identifying abusive tax arrangements

HMRC has published Guidance on how the General Anti-Abuse Rule (GAAR) Advisory Panel's opinion on Disguised Remuneration arrangements using dual payments can be used to determine when arrangements may be considered abusive tax arrangements.

Read the Guidance on identifying abusive tax arrangements.

HMRC updates its CIS Guidance

HMRC has updated its Guidance on claiming a refund of Construction Industry Scheme (CIS) deductions.

HMRC has added information to its Guidance regarding how CIS refunds work, when companies can claim them, when evidence should be uploaded with a claim, how to use CIS deductions to pay another tax, and what happens after a claim is submitted.

Read the updated CIS Guidance.

HMRC publishes Guidance on penalties for CIS payments

HMRC has published Guidance on penalties for CIS payments or returns connected to deliberate non-compliance.

The Guidance explains what penalties may be charged if HMRC has issued a determination under either section 62A or 62B of Finance Act 2004.

Read the Guidance on penalties for CIS payments.

HMRC updates its ADR Guidance

HMRC has updated its Guidance on Alternative Dispute Resolution (ADR).

The updated Guidance explains that ADR remains a non-statutory process, and each application for ADR is considered on a case by case basis. The Guidance clarifies when a taxpayer may apply for ADR and which disputes ADR is generally suitable for.

Read the updated ADR Guidance.

HMRC updates its Compliance Handbook for tax adviser sanctionable conduct rules

HMRC has updated its Compliance Handbook with new guidance on the tax adviser sanctionable conduct rules.

The updates provide additional examples of what is meant by sanctionable conduct and confirm that HMRC will inform tax advisers about the information HMRC intends to publish about them and when it will do so.

Read the updated Compliance Handbook.

Case reports

Full-time whistle blown in football referees employment status case

In Professional Game Match Officials Ltd v HMRC [2026] UKFTT 654 (TC), the First-tier Tribunal (FTT) allowed the taxpayer's appeal and held that football referees' individual match engagements were contracts for their services and not contracts of employment. The referees were therefore self-employed.

This decision demonstrates that when applying Ready Mixed Concrete (South East) Ltd v Minister of Pensions and National Insurance [1968] 2 QB 497, even where mutuality of obligation and control can be determined prima facie, the FTT must still consider whether the terms of the contract and nature of the relationship are consistent with a relationship of employment overall. This is likely to involve a detailed analysis of a range of factors, which will include mutuality of obligation and control, but which is likely to also include other factors such as integration, economic reality, financial risk, time commitment, dependence on a single paymaster, provision of equipment, length and continuity of relationship, exclusivity and substitution. 

Employment status cases remain highly fact-specific and the FTT will adopt a holistic, multifactorial analysis, when determining the employment status of workers. 

Read our commentary on Professional Game Match Officials Ltd.

Tribunal finds that film partnerships were carrying on a genuine trade

In Take 3.9 TV Partnership and others v HMRC [2026] UKFTT 696 (TC), the FTT held that the appellants were carrying on a genuine trade and therefore the equity-funded portion of their film production expenditure qualified for tax relief, but the debt-funded expenditure was incurred only to enhance tax relief and therefore did not qualify for tax relief.

Although turning on its own facts, this decision provides important guidance on the meaning of 'expenditure incurred', the trading test, and the application of the 'wholly and exclusively' rule, in the context of tax motivated film finance arrangements. 

Read our commentary on Take 3.9 TV Partnership.

HMRC prevented from imposing late payment penalties

In Jeremy Francis Herrmann v HMRC [2026] UKFTT 715 (TC), the FTT allowed the taxpayer’s appeals against late payment penalties and surcharges, holding that subsequent reallocation of payments could not retrospectively create late payment where the tax had been paid by the relevant statutory dates.

This decision may have wider implications for taxpayers seeking reallocation of historic payments. HMRC is likely to approach requests for reallocation more cautiously where the reallocation could affect the application of late payment penalties or surcharges, particularly following the opening of an enquiry.

Read our commentary on Herrmann.

And finally …

Adam Craggs and Jasprit Singh have published an article in Bloomberg Tax discussing the prospect of a new windfall tax on UK banks.

Read their article here: UK Windfall Bank Tax Would Worsen an Already Complex System.