Furlong Services Limited v HMRC: Upper Tribunal refuses extension of time after catalogue of solicitor errors

The Upper Tribunal (Tax and Chancery Chamber) has refused an application for an extension of time to seek permission to appeal in Furlong Services Limited v The Commissioners for His Majesty's Revenue and Customs [2026] UKUT 173 (TCC), delivered on 1 May 2026. The decision serves as a sharp reminder of the consequences that follow when advisers fail to engage adequately with tribunal rules and procedures.

The underlying dispute concerned an information notice issued by HMRC under Schedule 36 Finance Act 2008. The First-tier Tribunal ("FTT") had upheld certain elements of the notice whilst varying others, and crucially noted that its decision was final in accordance with paragraph 32(5) of that Schedule. The Appellant sought to challenge that decision by way of appeal to the Upper Tribunal, but the application for permission to appeal arrived nearly nine months out of time.

The history of procedural missteps is striking. After the FTT refused permission to appeal on 23 September 2024, the Appellant's solicitors — Rainer Hughes — submitted a further application to the FTT rather than to the Upper Tribunal, and did so using an FTT-specific form (T247) clearly intended for first-instance permission applications. The FTT did not respond until 6 March 2025, at which point it explained the error and provided Upper Tribunal contact details. Despite this, the solicitors promptly forwarded the same incorrect form to the Upper Tribunal, which in turn pointed out that it appeared the application had been misdirected. A valid application using Form FTC 1 was not lodged until 7 August 2025.

Upper Tribunal Judge Cannan applied the three-stage Martland framework, recently affirmed by the Court of Appeal in HMRC v Medpro Healthcare Ltd [2026] EWCA Civ 14. On the first stage, the delay of approximately nine months was unambiguously serious and significant. On the second, no satisfactory explanation was offered: the Appellant's solicitors provided no account of how the wrong form came to be used, why it was initially sent to the wrong tribunal, or why FTT guidance was not followed. Even attributing some of the delay to the FTT's own tardiness in responding, a culpable period of around five months remained.

The adjournment application — made just days before the oral hearing and grounded partly on the absence of the conduct solicitor abroad and partly on a claim that the Appellant's director had been unaware of the defaults — fared no better. The judge found it far too late to introduce witness evidence on the point and noted that the opportunity to explain the delays had already passed at both the Extension Application stage and in response to HMRC's written submissions.

On the third stage, the balancing exercise weighed against the Appellant. HMRC had expended resources on the extension and adjournment applications, and the purpose of the time limit — to promote finality — had been undermined. Compliance with the information notice as varied was accepted by counsel to be neither unduly onerous nor costly. As to the merits, the judge found it only arguable, rather than strongly arguable, that a right of appeal existed at all given the statutory finality provision. That assessment materially reduced the weight to be accorded to the Appellant's potential prejudice.

Rainer Hughes, the solicitors with conduct throughout, was closed by Solicitors Regulation Authority intervention on 1 April 2026. Applying the principle articulated in Katib and Hytec, the judge declined to distinguish between the firm's defaults and those of the Appellant itself, notwithstanding that the director appeared to have been kept in the dark.

The application for permission to appeal was refused.