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When does a tax mistake become a deliberate avoidance? And how far back can HMRC reach when taxpayers dodge their obligations? The recent 2025 First-tier Tribunal case Milligan v Revenue & Customs shines a spotlight on how “deliberate” behaviour triggers the full 20-year time limit for discovery assessments—underscoring the critical importance of engaging proactively with your tax affairs.
The Milligan Case: No Returns, No Answers
- The taxpayer, known as Mr. Milligan, had filed self-assessment returns in earlier years but stopped filing after 1999/2000, despite continuing to receive self-employment income.
- HMRC stepped in and issued discovery assessments for the missing years from 2000/01 to 2008/09 on May 20, 2013.
- The central question: Are these late but lengthy assessments valid under the extended 20-year rule for deliberate conduct, or were they out of time?
Did Milligan’s Behaviour Count as ‘Deliberate’?
HMRC’s position: Milligan’s consistent failure to file returns, his admitted habit of stacking HMRC mail unread—literally leaving it unopened in a room—showed a conscious choice to ignore his obligations.
The Tribunal agreed. This “head-in-the-sand” approach wasn’t mere forgetfulness or negligence—it was a deliberate failure to act. He knew he had tax responsibilities but chose to act willfully in non-compliance.
As a result, HMRC’s extended 20-year window to issue discovery assessments—enacted for deliberate errors—applied fully. The proposed assessments and associated penalties were upheld, and Milligan’s appeal was dismissed. This outcome stands as a reminder that ignoring tax responsibilities may stretch your liability horizon from just a few years to two decades.
Allowed Time Limits & What Triggers Them
UK tax law sets different time frames depending on the taxpayer’s behaviour:
- 4 years: for mistakes made despite reasonable care.
- 6 years: if the error resulted from carelessness.
- 20 years: if the loss of tax is deemed deliberate, or if there’s a failure to file or notify.
HMRC must only show that the conduct was deliberate. A pattern of disdain or avoidance, as seen in Milligan, easily meets that threshold, lifting the time limit dramatically.
Key Takeaways from the Milligan Decision
1. Know Your Deadlines—and What Avoids Them
- Ordinary time limits (4 or 6 years) can rapidly turn into 20 if HMRC says your behaviour was deliberate.
- Ignoring notices or failing to file on time doesn’t protect you—it exposes you to far longer assessments.
2. Intentional Non-Filing is Dangerous
- Deliberately avoiding your tax duties—even if you claim confusion or personal pressures—is insufficient to avoid the extended time limit.
- Courts expect taxpayers to engage with HMRC and understand their filing obligations actively.
3. HMRC Bears the Burden—but Be Prepared
- While HMRC must prove your behaviour was deliberate, strong record-keeping—like copies of correspondence, notes of inquiries, or evidence of non-delivery—can help defend your position.
- But in Milligan’s case, his admission that he ignored tax mail undermined any defence.
4. Act Sooner, Not Later
- Once HMRC detects non-compliance, they can go back years—even decades—if behaviour is judged deliberate.
- Filing voluntarily, even late, may reset the clock or provide evidence that you didn’t intend to evade.
Don’t Let Your Tax Obligation Become a 20-Year Liability.
Milligan’s case is a powerful illustration of what happens when taxpayers choose indifference over action. The law will hold you to account—potentially for 20 years—if it concludes you intentionally avoided your responsibilities.
Whether you’ve fallen behind on filings, ignored HMRC letters, or assume time will absolve you, the lesson is clear: proactive engagement matters. Filing late, but honestly, can be far less costly than silence.