Tribunal – Unreasonable excuse for late tax return
In a recent case a self assessment taxpayer claimed to have a reasonable excuse for the late submission of a her tax return. The Tribunal disagreed.
The taxpayer in this case was chargeable to income tax in the tax year ended 5 April 2006 and was therefore required to notify HMRC of her chargeability to income tax within six months from the end of the tax year i.e. by 5 October 2006.
On 17 September 2008, HMRC issued a tax return for the year ending 5 April 2006 with a filing date of 24 December 2008. The tax return was submitted on 2 December 2008, the tax due having been paid on 15 October 2008.
On 3 April 2009, HMRC issued a surcharge notice for the first and second surcharges relating to the period from 31 January 2007 (the due date) and 15 October 2008.
The taxpayer appealed against the imposition of surcharges giving four grounds for appeal including that the‘tax office pestered for money’ and ‘the tax office moved and delayed matters’. The tribunal rejected the taxpayer’s submissions saying they had no effect on whether the taxpayer had a reasonable excuse or not. The taxpayer also argued she had a verbal agreement with an HMRC officer that no penalties would be charged.
The tribunal found that on the balance of probabilities that there was no agreement that HMRC would not levy penalties or surcharges. The taxpayer’s appeal was dismissed.