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R (on the app. of Ingenious Media Holdings Plc) v Revenue and Customs Commissioners [2016] UKSC 54

Case date: 19/10/2016

Court: Supreme Court

Area/s of law: Confidence



In 2012, The Times published two articles on the subject of film schemes and tax avoidance.  The articles contained information from an interview, agreed to be “off the record”, disclosed to journalists by HMRC’s Permanent Secretary of Tax, including the name and tax activities of Mr McKenna, founder and CEO of Ingenious Media Holdings Plc and its subsidiaries (“Ingenious Media”). 

Ingenious Media and McKenna brought an application for judicial review of the decision to disclose the information on the ground, inter alia, that it breached s.18(1) of the Commissioners for Revenue and Customs Act 2005 (the “Act”), which provides that HMRC officials may not disclose information they hold in connection with HMRC functions.  S.18(2) lists exceptions to the prohibition on disclosure, including disclosures made “for the purposes of a function of the Revenue and Customs”: s.18(2)(a)(i).

At first instance, Sales J held that the Court could only intervene if satisfied that the Permanent Secretary could not rationally have taken the view that speaking to the journalists would assist HMRC in the exercise of its tax collection functions (and he held that the disclosures were not irrational).  The Court of Appeal upheld this decision, and the Claimants appealed to the Supreme Court.



The Supreme Court unanimously upheld the Claimants’ appeal.  It held that the information disclosed to the journalists was information of a confidential nature, in respect of which HMRC owed a duty of confidentiality to the Claimants under s.18(1) of the Act, and that the disclosure was not justified under s.18(2)(a)(i).


Key points

Lord Toulson, giving the Court’s judgment, stated that the claim was, in substance, a straightforward claim for breach of a duty of confidentiality by HMRC: [14].

It was a well-established principle of the law of confidentiality that where information of a personal or confidential nature is obtained or received in the exercise of a legal power or in furtherance of a public duty, the recipient will in general owe a duty to the person from whom it was received or to whom it relates not to use it for other purposes.  HMRC was entitled to receive and hold confidential information about individuals’ financial affairs to assess and collect (or make) tax payments: [17].  This duty was reflected in s.18(1) of the Act: [23].

The statutory exception in s.18(2)(a)(i) was to be interpreted narrowly.  To construe it in the wide way contended for by HMRC would (1) render a number of the other listed exceptions otiose; and (2) allow “words of the utmost vagueness” to significantly erode the protection afforded by HMRC’s duty of confidentiality: [19].  The Court made clear that “the more general the words, the harder it is likely to be” to rebut the presumption that Parliament intended that statutory provisions should be construed as subject to the basic rights of the individual: [20].  Parliament cannot have intended that by enacting s.18(2)(a)(i) it was authorising HMRC officials to discuss individual taxpayers in “off the record” discussions for collateral purposes such as developing HMRC’s relations with the press: [22].

The exception in s.18(2)(a)(i) permitted disclosure “to the extent reasonably necessary for HMRC to fulfil its primary function”: [23].  In the present case, HMRC’s desire to foster good relations with the press, its desire to publicise its views on tax avoidance schemes, and its belief that the journalists might have shared valuable information, did not justify the disclosure: [34].  Nor did the fact that the disclosure was made “off the record,” although the Court did not seek to lay down a rule that such a disclosure would never be justified: [35].

It was not necessary to rule on a further submission from HMRC based on the application of the statutory provisions to information already in the public domain, but the Court noted that it was settled law that information may be made known to the public, and yet may not be sufficiently widely known for all confidentiality in it to be destroyed: [25].

Regarding the Court’s approach to reviewing HMRC’s conduct, it was emphasised that “public bodies are not immune from the ordinary application of the common law” including the duty of confidentiality: [28].  Consequently, it was for the Court to decide the question of whether there had been a breach of confidentiality, and it was not constrained to reviewing the decision on public law principles: [29].

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