Litigation and Settlements Strategy (LSS)

Publication of draft Litigation and Settlement Strategy guidance and accompanying draft Alternative Dispute Resolution guidance

Following publication of HM Revenue & Customs (HMRC) Litigation and Settlement Strategy, draft internal guidance on the application of the LSS (PDF 350K), and HMRC’S use of Alternative Dispute Resolution (PDF 223K) is now available.

If you have any comments, please use the contact details at the bottom of the page, ideally before 31 October 2011.

The Litigation and Settlements Strategy (LSS) (PDF 33K) sets out the principles within which HMRC handles all disputes about any taxes, duties or credits, where those disputes are subject to civil law procedures, and whether disputes are resolved by agreement with the customer or through litigation. This includes most of HMRC's compliance activity.

The two key elements of HMRC's approach to tax disputes are:

  • supporting customers to get their tax right first time, so preventing a dispute arising in the first place
  • resolving those disputes which do arise in a way which establishes the right tax due at the least cost to HMRC and to its customers, which in most cases will involve working collaboratively.

The LSS encourages HMRC staff to:

  • minimize the scope for disputes and seek non-confrontational solutions
  • base case selection and handling on what best closes the tax gap
  • resolve tax disputes consistently with HMRC's considered view of the law
  • subject to that, handle and resolve disputes cost effectively - based on the wider impact or value of cases across the tax system and across HMRC's customer base
  • ensure that the revenue flows potentially involved make any dispute worthwhile
  • (in strong cases) settle for the full amount HMRC believes the Tribunal or Courts would determine, or otherwise litigate
  • (in 'all or nothing' cases) not split the difference
  • (in weak or non-worthwhile cases) concede rather than pursue

The LSS was introduced in 2007 and was refreshed in July 2011.

Contact information

By email to John Neale (HMRC Dispute Resolution)