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[2013] UKFTT 514 (TC)
TC02902
Appeal number: TC/2013/01908
Non-payment of income tax by due date – validity of claim to carry back losses to year for which tax due – meaning of “quantified” - FA 2009 Sch 56 para 3(2) & para 16(1) – TMA 1970 s42(2) & Sch 1B para 2(2) - appeal dismissed
FIRST-TIER TRIBUNAL
TAX CHAMBER
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MICHAEL E ROBINS |
Appellant |
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- and - |
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THE COMMISSIONERS FOR HER MAJESTY’S |
Respondents |
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REVENUE & CUSTOMS |
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TRIBUNAL: |
JUDGE MALACHY CORNWELL-KELLY |
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MS ELIZABETH BRIDGE MA |
Sitting in public at 185 Dyke Road, Brighton on 16 August 2013
Mr Peter Clarke of Clarke & Co for the Appellant
Ms Gloria Orimoloye of HM Revenue and Customs Solicitor’s Office for the respondents
© CROWN COPYRIGHT 2013
DECISION
The facts
Dear Sirs
M E Robins Esquire
My client has current year losses and will be setting them against his 2010-11 profits. He will not therefore be paying the £9,497.52 due on the 31st January 2012 or the £3,165.84 due on the 31st July 2012.
Yours faithfully
Peter Clarke
Clarke & Co
4. The legislation relevant is as follows -
– Taxes Management Act 1970
42 Procedure for making claims etc
(1) Where any provision of the Taxes Acts provides for relief to be given, or any other thing to be done, on the making of a claim, this section shall, unless otherwise provided, have effect in relation to the claim.
(1A) Subject to subsection (3) below, a claim for a relief, an allowance or a repayment of tax shall be for an amount which is quantified at the time when the claim is made.
(2) Subject to subsections (3) to (3ZC) below, where notice has been given under section 8, 8A . . . or 12AA of this Act, a claim shall not at any time be made otherwise than by being included in a return under that section if it could, at that or any subsequent time, be made by being so included.
(3) Subsections (1A) and (2) above shall not apply in relation to any claim which falls to be taken into account in the making of deductions or repayments of tax under PAYE regulations.
schedule 1b - claims for relief involving two or more years
Loss relief
2(1) This paragraph applies where a person makes a claim requiring relief for a loss incurred or treated as incurred, or a payment made, in one year of assessment (“the later year”) to be given in an earlier year of assessment (“the earlier year”).
(2) Section 42(2) of this Act shall not apply in relation to the claim.
(3) The claim shall relate to the later year.
(4) Subject to sub-paragraph (5) below, the claim shall be for an amount equal to the difference between—
(a) the amount in which the person is chargeable to tax for the earlier year (“amount A”); and
(b) the amount in which he would be so chargeable on the assumption that effect could be, and were, given to the claim in relation to that year (“amount B”).
(5) Where effect has been given to one or more associated claims, amounts A and B above shall each be determined on the assumption that effect could have been, and had been, given to the associated claim or claims in relation to the earlier year.
(6) Effect shall be given to the claim in relation to the later year, whether by repayment or set-off, or by an increase in the aggregate amount given by section 59B(1)(b) of this Act, or otherwise.
(7) For the purposes of this paragraph, any deduction made under section 62(2) of the 1992 Act (death: general provisions) in respect of an allowable loss shall be deemed to be made in pursuance of a claim requiring relief to be given in respect of that loss.
- Finance Act 2009, Schedule 56
Reasonable excuse
16(1) Liability to a penalty under any paragraph of this Schedule does not arise in relation to a failure to make a payment if P satisfies HMRC or (on appeal) the First-tier Tribunal or Upper Tribunal that there is a reasonable excuse for the failure.
(2) For the purposes of sub-paragraph (1)—
(a) an insufficiency of funds is not a reasonable excuse unless attributable to events outside P's control,
(b) where P relies on any other person to do anything, that is not a reasonable excuse unless P took reasonable care to avoid the failure, and
(c) where P had a reasonable excuse for the failure but the excuse has ceased, P is to be treated as having continued to have the excuse if the failure is remedied without unreasonable delay after the excuse ceased.
Submissions and Conclusions
11. For these reasons, the appeal must therefore be dismissed.
MALACHY CORNWELL-KELLY