Commenting on the outcome of the Supreme Court judgment regarding Littlewoods claim for the repayment of compound rather than simple interest by HMRC, Andrew Hubbard, tax consultant at RSM said:
‘This Supreme Court judgment will be an immense relief to HMRC – and to the UK taxpayer. The latest HMRC accounts revealed there were 19 ongoing cases in which HMRC was potentially liable to make tax repayments exceeding £100m - with the total contingent liability reaching almost £19bn.
‘The Littlewoods case was by far the biggest and this judgment will effectively put a stop to a potential 5,000 follow-up claims for repayment of compound rather than simple interest.
‘This case has been ongoing for years and has no doubt caused many sleepless nights for the incumbent chancellors. I wouldn’t be surprised if champagne corks are heard popping in the Treasury as a result.’