Grounds of appeal are your reasons for saying an HMRC decision is wrong. Section 31A(5) of the Taxes Management Act 1970 requires a direct tax notice of appeal to specify them, and rule 20 of the Tax Chamber Rules requires them in any notice of appeal to the tribunal. Good grounds name each part of the decision you dispute, say why it is wrong in law, fact or amount, and state the result you want; if they later need to change, the tribunal can permit an amendment.

What must a notice of appeal contain?

For income tax, capital gains tax and corporation tax decisions, the first appeal goes to HMRC. Section 31A TMA 1970 says the notice must be in writing, given within 30 days after the specified date to the officer who made the decision, and section 31A(5) says it must specify the grounds of appeal.

When the appeal reaches the First tier Tribunal (Tax Chamber), rule 20(2) of the Tribunal Procedure (First tier Tribunal) (Tax Chamber) Rules 2009 (SI 2009/273) lists what the notice of appeal must include:

  • your name and address, and those of any representative;
  • an address where documents can be sent to you;
  • details of the decision appealed against;
  • the result you are seeking; and
  • the grounds for making the appeal.

Rule 20(3) adds that you must send a copy of any written record of the decision, and any statement of reasons for it, that you have or can reasonably obtain. If the appeal is late, rule 20(4) requires the notice to ask for permission and explain why it was not made in time (see late appeals). GOV.UK warns that the tribunal returns applications with anything missing.

Why are some grounds treated as invalid?

HMRC’s Appeals, Reviews and Tribunals Guidance (ARTG2170) gives the example of a taxpayer who appeals an amendment because he thinks it is “unfair”. That is not a valid ground. The law also restricts the grounds available for some decisions, so a reason the legislation does not recognise does not make a valid appeal.

ARTG2171 tells officers who receive vague grounds to contact the taxpayer, explain why the grounds do not appear valid, and either ask for the appeal to be withdrawn or amended to include valid grounds. Officers are told to take a common sense approach. Do not rely on that generosity. A complaint about service, delay or rudeness belongs in the complaints process, not in grounds of appeal.

How should you structure the grounds?

Treat each ground as a separate, numbered proposition that the tribunal can accept or reject on its own. A useful order is:

  1. Jurisdiction and validity. Was the assessment made in time? Section 34(2) TMA 1970 says an objection that the time limit has expired can only be made on an appeal against the assessment, so it must be raised in the appeal.
  2. Conditions for the assessment. For a discovery assessment after a return was filed, section 29(3) only allows it if the loss was brought about carelessly or deliberately (section 29(4)) or HMRC could not reasonably have been aware of it from the information made available (section 29(5)).
  3. The substance. Why the tax treatment HMRC applied is wrong, citing the provision you rely on.
  4. The amount. Why the figures are wrong even if the principle is right, and what the right figure is.
  5. Penalties. Whether there was careless or deliberate behaviour at all, and if so whether the reductions, special reduction or suspension decisions were wrong.

Then state the result you want in plain terms, for example that the closure notice amendment should be cancelled, or the assessment reduced to a stated figure. The gaps in this order are where the burden of proof shifts, so it helps to know which side has to prove each point.

What does a good set of grounds look like?

Illustration only. HMRC issue a discovery assessment for the 2019 to 2020 tax year, adding £12,000 of profit, plus a careless inaccuracy penalty. Grounds might read:

  1. The assessment was made more than four years after the end of the tax year and is out of time under section 34 TMA 1970. The return was not inaccurate because of careless behaviour, so the six year limit in section 36(1) does not apply.
  2. The conditions in section 29(4) and (5) are not met. The treatment of the disputed receipts was disclosed in the white space of the return.
  3. In any event, £9,000 of the £12,000 represents loan repayments, not trading income. Bank statements and the loan agreement are enclosed.
  4. The penalty should be cancelled because there was no careless inaccuracy. Alternatively, it should be suspended.

Result sought: the assessment and penalty are cancelled, or alternatively the assessment is reduced to £3,000 of profit and the penalty recalculated.

How do the grounds shape the rest of the appeal?

The grounds frame the dispute HMRC must answer. Under rule 25, HMRC must send a statement of case within 42 days in a Default Paper case, or 60 days in a Standard or Complex case, stating the legislation under which the decision was made and HMRC’s position. ARTG8395 tells HMRC to identify the issues in dispute, refer to the customer’s arguments and explain why HMRC considers them wrong. Clear grounds produce a focused statement of case.

ARTG8040 notes that if some aspects of a direct tax case were settled after the appeal to HMRC but before it reached the tribunal, the tribunal considers the issues that remain. Narrowing the grounds after a statutory review is normal and saves time.

Can grounds of appeal be amended later?

Yes, with the tribunal’s permission. Rule 5(3)(c) allows the tribunal to permit or require a party to amend a document, which includes the notice of appeal. Rule 5(3)(a) also lets it extend time limits set by the rules or its own directions.

The tribunal exercises these powers in line with the overriding objective in rule 2: dealing with cases fairly and justly, which includes proportionality, avoiding unnecessary formality and avoiding delay. In practice an application to amend should:

  • set out the amended grounds in full, not just describe them;
  • explain why the new point was not raised earlier, for example because it arose from HMRC’s statement of case or new documents;
  • show why allowing it is fair to HMRC, who may need time to respond; and
  • be made as early as possible, well before any hearing.

Evidence supporting a new ground must also follow the tribunal’s directions. Rule 15(2)(b) allows the tribunal to exclude evidence that was not provided within the time allowed or in the manner directed, or where admitting it would be unfair.

HMRC can also move. ARTG8040 says the HMRC litigator may reinstate aspects of the case that the review officer had excluded, and ARTG8450 says new information you give HMRC before the hearing must be considered, which may lead to a varied decision or a settlement.

What happens if the grounds disclose no real case?

Rule 8(3)(c) lets the tribunal strike out all or part of an appeal if it considers there is no reasonable prospect of the appellant’s case succeeding. Under rule 8(4), it must first give you an opportunity to make representations. Weak or confused grounds invite this kind of application from HMRC, so it is better to drop a hopeless point and concentrate on the arguable ones.

What are the common mistakes?

  • Writing “the assessment is excessive” or “unfair” with no reason or figures behind it.
  • Forgetting the time limit point, which section 34(2) requires to be taken on appeal.
  • Disputing the tax but not the penalty, or the reverse. They are separate decisions.
  • Leaving out the result sought, which rule 20(2)(e) requires.
  • Not attaching the decision letter or review conclusion letter.
  • Raising a new argument for the first time at the hearing instead of applying to amend in advance.
  • Assuming a point lost before the First tier Tribunal can be reargued on the facts later. An appeal to the Upper Tribunal is limited to errors of law, and in some cases a Complex category appeal carries a costs risk.

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Reviewed by Christine Anderson, Broker, Solar Protect. Last reviewed 19 October 2026. Part of Accountapedia, the Solar Protect guide to UK tax and accounting. This page is general information, not personalised advice.