March 13, 2017

The well-known actor, Mr Martin Clunes, underwent cosmetic treatment for which he paid. The question the Tribunal was faced with was whether he was entitled to set the cost of the treatment, or some of it, against his earnings in the calculation of his income tax liability. In essence, he argued that he underwent the treatment for the purposes of his acting trade. HMRC argued that the expense was disqualified for relief by virtue of s 34 of the Income Tax (Trading and Other Income) Act 2005.

Mr Clunes sought a direction that the appeal should be heard in private, and that any resulting published decision should be anonymised. HMRC argued that this was not an appropriate case for such a direction as the relevant criteria had not been met.

Mr Clunes argued that although there was a public interest in the deductibility of the cost of cosmetic treatment incurred by an actor, it was not necessary for the public to know the identity of the actor. The same considerations would apply whoever the actor might be, he said, and the public’s understanding would not be enhanced by learning that Mr Clunes was the actor in question, nor impaired if his identity was concealed. If, however, his identity were revealed, he might become the target of mockery and jokes and, more importantly, his public perception, or what might be described as his celebrity persona, would be damaged. The expense in question here was not mundane and unlikely to attract attention, as (for example) travelling expenses might be, but related to treatment about which, because of its very nature, Mr Clunes felt sensitive.

Following Revenue and Customs Commissioners v Banerjee (No 2) [2009] EWHC 1229 (Ch), Judge Colin Bishopp found that any taxpayer who was not in the public eye but who, for example, would prefer his friends or neighbours not to know of his financial affairs, would find it impossible to persuade the tribunal to grant him anonymity. The public interest in the outcome of tax litigation, whether in the High Court or in the tribunal, outweighed the desire of the taxpayer for anonymity, and the inevitable resultant intrusion into matters which might otherwise remain confidential was the price that had to be paid for open justice, however unpalatable the individual taxpayer might find it to be. Moreover, the structure of Rule 32 of the Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009 made it clear that there was a strong presumption in favour of public hearings, and that the circumstances in which that presumption may be overridden were wholly exceptional.

In addition, the tribunal would have to determine the appeal by reference to Mr Clunes as an individual and by reference to his personal characteristics. “I do not see how the public interest in the fair administration of tax can be satisfied by the release of a decision which, by concealing those characteristics, makes it impossible for the reader to reach a full understanding of the reasons why the appeal has been determined as it has”, the judge said.