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The Open Spaces Society has welcomed the decision of His Majesty’s Revenue and Customs (HMRC) not to appeal an order of the first-tier tribunal that it must disclose to the public heritage management plans (HMPs) for country estates benefiting from inheritance tax relief.
The moat at Alnwick Castle, 2019, subject to an HMP. Photo: ©Ian Capper, Creative Commons Licence.
An application was made by Kieran Foster to HMRC for the HMPs for Bolton Abbey, Chatsworth, Alnwick Castle, and Firle Estate. The plans were believed to have been compiled by the estate owners, as a requirement of conditional exemption from inheritance taxes under the Heritage Relief Scheme. The plans are drawn up following negotiation with Natural England and Historic England. Mr Foster’s request was made under the Environmental Information Regulations 2004 and stated that: ‘a common undertaking in conditionally exempt agreements is one of public access to the relevant heritage assets, there is, therefore, a clear public interest in identifying both the assets to which access has been granted and the nature of how they will be managed and made accessible’.
The request was refused by the department under r.12(1)(d), where ‘confidentiality is provided by law’. S.18 of the Commissioners for Revenue and Customs Act 2005 prohibits disclosure of taxpayer’s affairs. An appeal against the refusal lay to the Information Commissioner, who agreed with the department. The r.12(1)(d) exemption is subject to a public interest test, but the Commissioner found ‘a strong public interest in maintaining an exception, while disclosure ‘could adversely affect HMRC’s ability to carry out its statutory functions’.
Mr Foster applied to the first-tier tribunal. In a lengthy judgment, the tribunal ordered the department to release the plans, subject to redaction. It found that r.12(1)(d) was not engaged. It found no evidence that disclosure would materially harm confidentiality, and at the hearing, the department appeared to be at a loss to show what specific harms would arise. The tribunal also decided that, if it were wrong on that test, ‘the Public Interest balance…overwhelmingly…favours disclosure’. The tribunal found: ‘a matter of significant public interest in disclosure so that the public can be well informed of the details of the requirements and obligations they are entitled to expect arising from material and significant concessions granted as a result of the [HMP].’
The society recently has learned that HMRC has abandoned its attempt to appeal the decision of the first-tier tribunal to the upper tribunal. This means that the decision of the first-tier tribunal will be greatly influential in any subsequent request for the disclosure of HMPs.
Says Hugh Craddock, one of our case officers: ‘We welcome greater transparency in the disclosure of the arrangements for deferral of inheritance tax for heritage assets such as country estates. This should enable the public to find out more about what additional access has been granted to the public in return for very substantial inheritance-tax advantages. We suspect that in many cases, the answer is: very little. We shall campaign for a better deal where it is obvious that the access benefits are derisory.’
Hugh added: ‘We commend Mr. Foster for his tenacity in pursuing his appeal to the first-tier tribunal, and regret that the Information Commissioner swallowed the HMRC line that HMPs could not be disclosed for reasons of taxpayer confidentiality. The disclosure of HMPs will enable the public to see what assessment has been made of the need for conservation of and access to heritage assets. In some cases, this may increase pressure on HMRC to improve on what often can seem a very poor deal for the taxpayer in terms of public access.’
Note
Until 1998, the mere existence of heritage-tax-exemption agreements was a state secret. Estate owners could take the credit for providing very limited permissive access, having secured substantial deferral of inheritance tax as a reward for doing so. On some estates, access obligations were no more than to permit access along public rights of way. Part IV of the Finance Act 1998 enabled (now) HMRC to publicise the existence of agreements, but not the content of HMPs. Information is published online about the heritage assets and the extent of any of access to them.