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Court of Appeal lowers the bar for refusing tax discrepancy cases


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In the case of Tahir Yaseen v Secretary of State for the Home Department [2020] EWCA Civ 157, the Court of Appeal has reiterated that refusals on the ground of character or conduct require a balancing exercise, taking into account both positive and negative considerations.

The appellant, Mr Yaseen, made an application for indefinite leave to remain on the basis of his ten-year lawful residence in the UK. His application was refused on character grounds, due to a tax issue.

There are, however, two main differences between this case and others we have seen so far:

  • Mr Yaseen did not declare different incomes to HMRC and the Home Office. Rather, he did not submit three years worth of tax returns at all until after he submitted his application for indefinite leave and was called for an interview by the Home Office.
  • The Home Office refused the application relying not only on paragraph 322(5), but also on paragraph 276B(ii), which applies to indefinite leave to remain on the ground of ten years’ lawful residence in the UK.

Paragraph 276B(ii) ended up being the “winning” paragraph from the Home Office point of view. It reads:

276B. The requirements to be met by an applicant for indefinite leave to remain on the ground of long residence… are that:

(ii) having regard to the public interest there are no reasons why it would be undesirable for him to be given indefinite leave to remain on the ground of long residence, taking into account his:

(c) personal history, including character, conduct…

Paragraph 322(5) says:

Grounds on which leave to remain and variation of leave to enter or remain in the United Kingdom should normally be refused…

(5) the undesirability of permitting the person to remain… in the light of his conduct… character or dissociations…

I honestly struggle to see the difference between the two. But the Court of Appeal agreed with the lower tribunals and the Secretary of State that a refusal under paragraph 322(5) requires a finding of dishonesty, while a refusal under paragraph 276B doesn’t. Similarly, it agreed that the case law on tax discrepancies does not apply to refusals under paragraph 276B.

The court found, however, that before a refusal under paragraph 276B can be made, the decision-maker should conduct a balancing exercise taking into account both positive and negative factors relating to the applicant’s character. It decided that the First-tier Tribunal had failed to do so, and therefore remitted the case for the tribunal to reconsider.

As mentioned before, I struggle to follow the logic behind setting two different tests for paragraphs which read so much alike. All it does, it seems to me, is lower the bar for the Home Office. Officials can now rely on paragraph 276B instead of 322(5), without having to make a finding of dishonesty.  

People applying under the long residence rules who know there may be issues with their taxes would be well advised to submit “counter” evidence of their good character.

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Nath Gbikpi

Nath is an immigration lawyer at Leigh Day Solicitors and a Visiting Fellow in Practice at the London School of Economics.