HMRC in breach of confidentiality laws, finds Supreme Court

The Supreme Court has published a judgement finding that HMRC was in breach of confidentiality laws by leaking information to the press.

The court found that David Hartnett, former permanent secretary for tax at HMRC, leaked confidential information about Patrick McKenna, CEO of Ingenious, to journalists at The Times.

“The fact that Mr Hartnett did not anticipate his comments being reported is in itself no justification for making them,” stated Lord Toulson in the judgment. “The whole idea of HMRC officials supplying confidential information about individuals to the media on a non-attributable basis is, or should be, a matter of serious concern.”

James Badcock, partner and head of tax and estates at Collyer Bristow, said: “HMRC went much too far and they should not be providing confidential information about taxpayers to the media.”

The decision was in favour of the CEO of Ingenious Media, even though the High Court and Court of Appeal had previously decided in favour of HMRC.

“Having earlier won this case in both the High Court and Court of Appeal, HMRC is naturally disappointed by the judgement handed down by the Supreme Court” said a HMRC spokesperson.

Articles published in The Times on the basis of the leak included quotes from a ‘senior Revenue official’ including “he’s a big risk for us” and “we [HMRC] would like to recover lots of tax relief he’s generated for himself and for other people”.

The HMRC spokesperson, added: “HMRC defended this case because it considered that the disclosure made by Mr Hartnett was lawful. It is important to clarify that this judgment has no bearing on the three Ingenious film partnerships considered by the first tier tribunal, where HMRC was successful. This protected around £400m in revenues for the Exchequer.”

Badcock, concluded: “HMRC leaking [the information] brings unnecessary aggravation to a dispute. Every taxpayer, has a right of confidentiality. It is surprising that HMRC would choose to leak confidential information about a taxpayer with whom they were in an ongoing dispute, this is highly improper.”

“It is reasonable for HMRC to publicise their work against tax evasion in the media but this should not include the disclosure of confidential information about specific individuals.”

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