First-tier Tribunal (Tax)

[2011] UKFTT 259 (TC)

TC01123

Appeal number: TC/2011/00378

Reasonable excuse.

FIRST-TIER TRIBUNAL

TAX

LOUISE FERNANDEZ Appellant

- and -

THE COMMISSIONERS FOR HER MAJESTY’S

REVENUE AND CUSTOMS Respondents

TRIBUNAL: GERAINT JONES Q. C.  (TRIBUNAL JUDGE)

The Tribunal determined the appeal on 14 April 2011 without a hearing under the provisions of Rule 26 of the Tribunal Procedure (First-tier Tribunal)(Tax Chamber) Rules 2009 (default paper cases) having first read the Notice of Appeal dated 09 January 2011 and  HMRC’s Statement of Case submitted on 17 February 2011.

© CROWN COPYRIGHT 2011

DECISION

1.       The appellant, this Fernandez, appeals against two late filing penalties, each in the sum of £100, levied by HMRC on the basis that she failed to file her self assessment tax return for the year ended 5 April 2009 by 31 January 2010 (the first £100 penalty) and then within a further period of six months (the second £100 penalty).

2.       The primary facts are not in dispute. The appellant does not dispute that she did not file her self-assessment return by the 31 January 2010. Instead, she submitted a paper return on 3 December 2010, some 11 months after the last filing date.

3.       Nonetheless, says the appellant, she has a reasonable excuse for late filing. HMRC contends, wrongly, that a "reasonable excuse" must amount to some kind of exceptional circumstance or event beyond the control of the taxpayer. I do not accept that legal analysis. Parliament has quite clearly used the phrase "reasonable excuse". Those are ordinarily everyday English words which must be given their ordinary and natural meaning. Their ordinarily natural meaning is not that there has been an exceptional event outside the control of the taxpayer.

4.       The appellant's case is that towards the end of January 2010 she attempted to file her tax return online. That evidence is supported by her e-mails of 13 and 15 January 2010, the first timed at 18:34 hours, where she said that she had attempted to use the online filing facility provided by HMRC but found herself denied access to the site. She said that she had been sent access codes by HMRC but they did not facilitate access.

5.       As the appellant had had difficulty using the online filing facility she sent e-mails to ecustomer.support@hmrc.gsi.gov.uk seeking assistance. There is no evidence that she ever received a reply.  In HMRC’s Case Statement it is asserted that the appellant sent her e-mails of the 13 and 15 January 2010 to the  VAT Online Services Helpdesk "in error". Quite why there was any error in using the e-mail address to which I have referred, I do not understand. HMRC is one organisation and unless it adequately made it clear that the address used by the appellant would not elicit a response to her request for assistance, I find the comment in the Case Statement wholly unconvincing and misconceived.

6.       HMRC further contends that it was the appellant's responsibility to ensure that her tax affairs were dealt with correctly and on time. It argues that that responsibility was not negated by the appellant sending her two e-mails to the helpdesk. It also contends that it could not reasonably be expected to reply to the appellant's e-mails prior to the 31 January 2010. I find that proposition startling. I have little doubt that HMRC would expect a business to which it had sent correspondence, both to be able to reply within 14 days and actually to reply. There is no reason why the standards applicable to businesses and commercial organisations should not also apply to an organ of the state.

7.       Whilst it may have been the appellant's responsibility to file her self assessment return on time, it was equally the responsibility of HMRC to provide online filing facilities that worked and provided the promised filing facility. I accept the appellant's evidence that so far as she is concerned, the promised online filing facility did not work and allow her to file on time. I am wholly unimpressed by the argument that there was no obligation on HMRC to reply to the appellant's e-mails to its helpdesk; there is little point in there being a helpdesk if, in fact, it does not provide help. The appellant was, in my judgement, entitled to expect that the requested help would be forthcoming timeously and, in any event, in good time for her to be able to use the online filing facility by 31 January 2010.

8.       In my judgement the appellant had a reasonable excuse for failing to file online by the 31 January 2010. That reasonable excuse was/is that the online filing facility provided by HMRC did not work as it should have worked when she tried to use it and, furthermore, HMRC failed to provide her with the help that she had requested within a reasonable time which, in my judgement, should have been within three days.

9.       The second £100 penalty was triggered because the return had still not been filed some six months later. I cannot conceive that the reasonable excuse to which I have referred above could possibly apply to the continued failure to file. It must have been apparent to the appellant that she had not received a reply from the helpdesk and thus she would have to go to other lengths to file her return. She did not do so, being satisfied to sit back and await events. That comes nowhere near to presenting a reasonable excuse.

10.    In the result I allow the appellant's appeal against the first £100 penalty; I dismiss the appellant's appeal against the second £100 penalty.

11.    This document contains full findings of fact and reasons for the decision. Any party dissatisfied with this decision has a right to apply for permission to appeal against it pursuant to Rule 39 of the Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009. The application must be received by this Tribunal not later than 56 days after this decision is sent to that party.  The parties are referred to “Guidance to accompany a Decision from the First-tier Tribunal (Tax Chamber)” which accompanies and forms part of this decision notice.