Analysis
The appellant (A) in his capacity as executor of an estate appealed against the imposition of a late filing penalty of £400 in relation to a trust and estate tax return for the year 2012/2013.
HMRC sent A a notice on 6 April 2013 requiring submission of a trust and estate return for that year by 31 October 2013 for paper returns or 31 January 2015 if electronically. On 18 February 2014 HMRC sent A a notice of penalty assessment of £100 for failure to submit the return on time. A appealed to HMRC on 4 March 2014 stating that he had written to HMRC on 27 March 2013 clarifying that no income was expected on the estate. He then submitted the paper return on 12 March 2014. HMRC issued a notice of penalty on 18 March 2014 for £400. A appealed on 28 March 2014. HMRC told A in a letter dated 25 March 2014 that A must have a reasonable excuse for the failure to submit on time and decided that he did not.
A contended that the two penalties were unreasonable in circumstances where a number of written questions in correspondence were not properly acknowledged or responded to.
HMRC contended that the notice to file the return was clear and HMRC issues notices in advance reminding taxpayers of deadlines. Even if A was waiting for a reply to his 27 March 2013 letter, there is no evidence of subsequent correspondence suggesting A did not need to comply with the filing deadline.
Held:
- 1) There is no statutory definition of reasonable excuse. It is to be considered in light of all the circumstances of the particular case. The onus was on A to demonstrate that he had reasonable excuse for late filing.
- 2) A did not have reasonable excuse. It would have been simple for A to clarify with HMRC whether he needed to file the return or not. No evidence was produced as to when A posted the return or of postal delays.
3) Appeal rejected. The penalties of £100 and £400 remained due for payment.
Continue reading "Groves v HMRC [2014] UKFTT 858 (TC)"