First-tier Tribunal (Tax)

[2014] UKFTT 185 (TC)

TC03325

Appeal number: TC/2013/06510

PAYE – SELF-ASSESSMENT – LATE FILING OF RETURN –  PROBLEMS WITH  SOFTWARE-TOLD BY HMRC THAT UNLIKELY PENALTY WOULD BE CHARGED -  WHETHER REASONABLE EXCUSE - NO – APPEAL DISMISSED

FIRST-TIER TRIBUNAL

TAX CHAMBER

The Tribunal determined the appeal on 3 February 2014 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 17 September  2013 (with enclosures), and HMRC’s Statement of Case submitted on 12 December 2013 (with enclosures).

© CROWN COPYRIGHT 2014

DECISION

1 The appellant appeals against the decision of HMRC to impose a  penalty of £100  under Paragraph 3 of Schedule 55 to the Finance Act 2009 for the late filing of his individual tax return  for the year ending 5 April 2012.  An electronic return was received by HMRC on 26 February 2013. The notice of appeal was received late but accepted on application to the Tribunal.

2. In the Notice of Appeal the appellant’s accountant says that the appellant had tried to submit his return on 31 January 2013 but there was no acceptance due to problems at HMRC’s end and despite many phonecalls it was not completed for some time. He says too that the appellant had been assured that no penalty would be charged. The accountant provided to HMRC some correspondence from the appellant and a schedule of telephone calls made by the appellant to HMRC.

3. The position of HMRC is that the appellant was under a responsibility to submit his return on time. They accept that the appellant had been in contact with them several times after 31 January 2013 and indeed phoned their helpline on 1 February 2013, but say there is no record of any attempt to file his return on or before that date, the first attempt being an unsuccessful one on 4 February. They note that the appellant had provided no evidence of any attempt to file prior to that. The appellant’s own schedule of events shows that he was in touch with HMRC on10 February and did access his account on that day but failed to successfully file his return.  HMRC say that the appellant’s paper returns for 2007/8 and 2008/09 were filed late. They  conclude that the appellant has not established that on a balance of probabilities there is a reasonable excuse for his failure to file his return  on time.  

4.  If a person is to rely on reasonable excuse, this must have existed for the whole of the period of default. A reasonable excuse is normally an unexpected or unusual event, either unforeseeable or beyond the person’s control, which prevents him from complying with an obligation when he otherwise would have done. The matter has to be considered in the light of the actions of a reasonable prudent tax payer exercising foresight and due diligence and having proper regard for his responsibilities under the Taxes Act.  

5. I have given careful consideration to all the evidence before me in this case. The first entry on the schedule provided by the appellant at (Folio 11) is dated ‘midnight on 31 January’ and records difficulties trying to file the return. The second is contact by phone with HMRC on 1 February in the course of which he was given advice about filing online and told he would not be fined for late filing. He tried to file the return that day but again it was unsuccessful. He phoned HMRC again on 3 February and had a discussion with a lady about his User ID. He had previously been told it was his password that was the problem and when he tried again to file the return the message he received was that his password did not conform. On 4 February he was told how to get  a User ID and password and that if log in failed  he was to  call back. He contacted HMRC again on 10 February and was told he had the right ID and password. The appellant does not say whether he tried to file that day or after getting advice on 4 February or not. The next entry is dated 25 February when  the appellant tried to phone HMRC  but hung up because he was kept waiting so long for  an advisor. On 26 February he spoke to an advisor who told him he would be unlikely to get a fine after the ‘saga’. The line then went dead.

6. I accept that the appellant had some difficulties. It seems from the records of HMRC that he had successfully filed his two previous returns online. There is no record of any attempt to file on 31 January but even if I accept that there was an attempt and that the appellant telephoned HMRC the next day for help there is no indication of any concerted effort by the appellant to file the return after the first advice was given on 3 February. He was given help on 4 February and was told to phone back if he had any problems but  did not contact HMRC again until 10 February when he was  told he had the correct password and ID and should try again and  phone back if he had any problems. It seems that he then took no action until two weeks later on 25 February. Even if the appellant did try to file his return on the day of the deadline it is clear that help was available from HMRC and that assistance was given to enable the appellant to file the return by 4 February. There is no explanation for the fact that there was a further delay and in these circumstances   I find that the appellant  has  not established that he has a reasonable excuse for his failure to file his return on time.  

7.  I dismiss the appeal.

8.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.

N A BAIRD

TRIBUNAL JUDGE

RELEASE DATE:  13 February 2014