First-tier Tribunal (Tax)

[2020] UKFTT 129 (TC)
TC07628

INCOME TAX - Schedule 55 Finance Act 2009 - fixed and daily penalties for failure to file a self-assessment return on time - whether taxpayer had a reasonable excuse for her default - appeal dismissed. Permission to appeal out of time - refused."

FIRST-TIER TRIBUNAL TAX CHAMBER

Appeal number:  TC/2019/06773

 

BETWEEN

 

MARTA LASEK

Appellant

 

 

-and-

 

 

THE COMMISSIONERS FOR HER MAJESTY’S REVENUE AND CUSTOMS

Respondents

 

 

 

TRIBUNAL:

JUDGE Abigail HUDSON

 

 

The Tribunal determined the appeal on 17 February 2020 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 25 October 2019 (with enclosures) and HMRC’s Statement of Case (with enclosures) acknowledged by the Tribunal on 27 November 2019.

 

DECISION

INTRODUCTION

1.      This is an appeal by Ms Marta Lasek (‘the Appellant’) against fixed and daily penalties totalling £1300 imposed by the Respondents (‘HMRC’) under Paragraph 3, 4 and 5 of Schedule 55 Finance Act 2009, for her failure to file a self-assessment (‘SA’) tax return on time for the tax year ending 5 April 2016.

BACKGROUND

2.      The Appellant’s return for 2015-16, was due if filed electronically no later than 31 January 2017.

3.      The penalties for late filing of a return can be summarised as follows:

(i) A penalty of £100 is imposed under Paragraph 3 of Schedule 55 Finance Act (‘FA’) 2009 for the late filing of the Individual Tax Return.

(ii) If after a period of 3 months beginning with the penalty date the return remains outstanding, daily penalties of £10 per day up to a total of £900 are imposed under Paragraph 4 of Schedule 55 FA 2009.

(iii) If after a period of 6 months beginning with the penalty date the return remains outstanding, a penalty of £300 is imposed under Paragraph 5 of Schedule 55 FA 2009.

(iv) If after a period of 12 months beginning with the penalty date the return remains outstanding, a penalty of £300 is imposed under Paragraph 6 of Schedule 55 FA 2009.

4.      The Appellant’s electronic return for 2015-16 was filed on 12 September 2017.  It was therefore not filed on time and penalties of £100, £900 and £300 were imposed, under (i), (ii) and (iii) above.  

Filing date and Penalty date

5.      Under s 8(1D) TMA 1970 a non-electronic return must normally be filed by 31 October in the relevant financial year or an electronic return by 31 January in the year following.   The ‘penalty date’ is defined at Paragraph 1(4) Schedule 55 FA 2009 and is the date after the filing date.

Reasonable excuse

6.      Paragraph 23 of Schedule 55 FA 2009, provides that a penalty does not arise in relation to a failure to make a return if the person satisfies HMRC (or on appeal, a Tribunal) that they had a reasonable excuse for the failure and they put right the failure without unreasonable delay after the excuse ceased.

7.      The law specifies two situations that are not reasonable excuse:

(a) An insufficiency of funds, unless attributable to events outside the Appellant’s control, and

(b) Reliance on another person to do anything, unless the person took reasonable care to avoid the failure.

8.      There is no statutory definition of “reasonable excuse”. Whether or not a person had a reasonable excuse is an objective test and “is a matter to be considered in the light of all the circumstances of the particular case” (Rowland V HMRC (2006) STC (SCD) 536 at paragraph 18).

9.      The actions of the taxpayer should be considered from the perspective of a prudent person, exercising reasonable foresight and due diligence, having proper regard for their responsibilities under the Tax Acts.  The decision depends upon the particular circumstances in which the failure occurred and the particular circumstances and abilities of the person who failed to file their return on time. The test is to determine what a reasonable taxpayer, in the position of the taxpayer, would have done in those circumstances and by reference to that test to determine whether the conduct of the taxpayer can be regarded as conforming to that standard.

10.  The onus lies with HMRC to show that the penalties were issued correctly and within legislation.  If the Tribunal find that HMRC have issued the penalties correctly the onus then reverts to the Appellant to show that he / she has a reasonable excuse for the late filing of his / her SA tax return.

The background facts

11.  The Appellant’s 2015-16 return was issued to her on 6 April 2016 and was due to be returned by 31 January 2017 if returned electronically.  The Notice to file a return was issued to the correspondence address provided by the Appellant.

12.  The Appellant’s grounds of appeal are unclear.  She is possibly stating that she did not realise that she would have to file a return and did not receive the notice to file.  She is possibly stating that she did know that there was a requirement to file but believed that her agent had done it on time.  In either circumstance, she asserts that she had a reasonable excuse for the delay in filing a return.

13.  The SA return was received electronically by HMRC on 12 September 2017.  It was over seven months late.

14.  HMRC imposed a fixed penalty of £100 together with daily penalties [90 days at £10 for each day] totalling £900.  The return still having not been received six months after the filing date HMRC then imposed a fixed penalty of £300. 

15.  The Appellant appealed to the Tribunal on 25 October 2019.  

PERMISSION TO APPEAL OUT OF TIME

16.  The appellant’s appeal to HMRC under s31A TMA 1970 was made outside the statutory deadline. HMRC refused consent under s49(2)(a) of TMA 1970. For the following reasons, I have decided not to give permission for the appeal to be notified late:

17.  The relevant penalty notices were dated 7 February 2017 and 11 August 2017, and were sent to the Appellant’s registered correspondence address.  Therefore the time limit for appealing expired on the 9 March 2017 and the 10 September 2017.  In relation to the latest penalties the Appellant is 604 days late in appealing to HMRC.  That in itself is serious and significant.  However, the appeal against the earlier penalty is almost 789 days late. 

18.  The Appellant filed her self-assessment return in September 2017.  She has appealed the penalty notices in May 2019.  She explains that it took her so long to make the appeal because she didn’t realise that she had accrued penalties until January 2019.  The appellant or her agent filed an online return in September 2017 and it must have been clear from the government gateway that she had accrued penalties.  Further, she filed her return in September 2017 for the tax year 2015-2016.  She has filed tax returns in the past and must have been aware that the filing in September was late.  The very fact that she was filing late would have alerted her to the likelihood of accrued penalties.  She must have been aware of the penalties by September 2017 at the latest and yet it was a further 18 months before she filed an appeal. 

19.  The implication of her notice of appeal is that an agent filed the return for her, she having not begun to file her own until January 2019, but nowhere has she explained what action she took regarding her agent’s late filing.  Any reputable agent would have filed on time, and if some oversight resulted in a late filing, they would have explained the situation and notified her of the penalties.  This is not explained by the appellant.  In any event, the penalty notices were sent to her directly and must have alerted her to the fact that her return was late.  For the reasons given below I do not accept that no penalty notices were received by her until 2019.

20.  The consequences to either party of an extension of time limits must be considered in light of my assessments of the merits of the substantive appeal.  The Respondent is entitled to some finality in properly administering the SA tax regime and the time limits have been imposed by statute to provide that finality.  The Appellant would be prejudiced by a refusal to extend the time limits, however, she has offered no good explanation for her delay in appealing, and I do not consider that the explanation given for her late filing of her return constitutes a reasonable excuse for either delay.

21.  In considering the application for permission to appeal out of time, pursuant to Data Select Ltd v HMRC [2012] UKUT 187 (TCC) I have considered:

a)      The length of the delay;

b)      Whether there is a good explanation for that delay;

c)      The consequences of permission to appeal;

d)     The consequences of refusal of permission.

22.  In the circumstance I do not consider that the appellant has a good explanation for her delay which is of some significant length.  In balancing the prejudice caused to both parties, I conclude that it would be inappropriate to extend the time limit for appeal, and the application for permission to appeal out of time is refused.

The Appellant’s case

23.  The Appellant’s grounds of appeal appear to be that an agent was expected to file the return on time but failed to do so.  Accordingly, she had a reasonable excuse for the delay in filing a return.

HMRC’s Case

24.  A late filing penalty is raised solely because a SA tax return is filed late in accordance with Schedule 55 FA 2009, even if a customer has no tax to pay, has already paid all the tax due or is due a refund.  

25.  Where a return is filed after the relevant deadline a penalty is charged.  The later a return is received, the more penalties are charged.

Reasonable Excuse

26.  Under Paragraph 23 (1) Schedule 55 FA 2009 liability to a penalty does not arise in relation to failure to make a return if the taxpayer has a reasonable excuse for failure.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 

27.  ‘Reasonable excuse’ was considered in the case of The Clean Car Company Ltd v The Commissioners of Customs & Excise by Judge Medd who said:

“It has been said before in cases arising from default surcharges that the test of whether or not there is a reasonable excuse is an objective one. In my judgment it is an objective test in this sense. One must ask oneself: was what the taxpayer did a reasonable thing for a responsible trader conscious of and intending to comply with his obligations regarding tax, but having the experience and other relevant attributes of the taxpayer and placed in the situation that the taxpayer found himself at the relevant time, a reasonable thing to do?” [Page 142 3rd line et seq.].

28.  HMRC considers a reasonable excuse to be something that stops a person from meeting a tax obligation on time despite them having taken reasonable care to meet that obligation.  HMRC’s view is that the test is to consider what a reasonable person, who wanted to comply with their tax obligations, would have done in the same circumstances and decide if the actions of that person met that standard.

29.  If there is a reasonable excuse it must exist throughout the failure period.

30.  The Appellant has not provided a reasonable excuse for her failure to file her tax return for the year 2015-16 on time and accordingly the penalties have been correctly charged in accordance with the legislation.

31.  The amount of the penalties charged is set within the legislation. HMRC has no discretion over the amount charged and must act in accordance with the legislation.  By not applying legislation and as such not to have imposed the penalty would mean that HMRC was not adhering to its own legal obligations.

Special Reduction

32.  Paragraph 16(1) of Schedule 55 allows HMRC to reduce a penalty if they think it is right because of special circumstances.  “Special circumstances” is undefined save that, under paragraph 16(2), it does not include ability to pay, or the fact that a potential loss of revenue from one taxpayer is balanced by a potential overpayment by another.

33.  In other contexts “special” has been held to mean ‘exceptional, abnormal or unusual’ (Crabtree v Hinchcliffe [1971] 3 All ER 967), or ‘something out of the ordinary run of events’ (Clarks of Hove Ltd v Bakers’ Union [1979] 1 All ER 152). The special circumstances must also apply to the particular individual and not be general circumstances that apply to many taxpayers by virtue of the penalty legislation (David Collis [2011] UKFTT 588 (TC), paragraph 40).

34.  Where a person appeals against the amount of a penalty, paragraph 22(2) and (3) of Schedule 55, FA 2009 provide the Tribunal with the power to substitute HMRC’s decision with another decision that HMRC had the power to make.  The Tribunal may rely on paragraph 16 (Special Reduction) but only if they think HMRC’s decision was ‘flawed when considered in the light of the principles applicable in proceedings for judicial review’.

35.  HMRC have considered the Appellant’s grounds of appeal but assert that her circumstances do not amount to special circumstances which would merit a reduction of the penalties.

36.  Accordingly, HMRC’s decision not to reduce the penalties under paragraph 16 was not flawed.  There are no special circumstances which would require the Tribunal to reduce the penalties.

FINDINGS OF FACT

37.  A person is liable to a penalty if (and only if) HMRC give notice to the person specifying the date from which the penalty is payable.  I am satisfied that the penalty notices dated on or around 7 February 2017 and 11 August 2017 were sent to the postal address linked to the Appellant’s SA account (Donaldson v The Commissioners for HM Revenue & Customs [2016] EWCA Civ 761).

38.  The notice to file was sent to that address on 6 April 2016 and statements of accounts have been issued to that address on 1 March 2017, 6 September 2017, 11 October 2017, 23 November 2017, 28 December 2017 and 27 February 2019.

39.  Mrs Lasek has been registered at the same address since 8 September 2015 and remains registered at that same address which is also the address given on her notice of appeal. There is no evidence before me of any postal difficulties at around the relevant times and none of the correspondence issued to that address has been returned undelivered.  I am satisfied that the notices were received at Mrs Lasek’s home address.

40.  No record of any communication between Mrs Lasek and her previous agent, or Mrs Lasek and HMRC has been provided to me. 

41.  It is agreed that the return was in fact submitted electronically on 12 September 2017. The HMRC computer system does not allow a customer to submit a tax return for the same tax year twice.  Therefore, the return having been submitted on 12 September 2017 effectively, it must not have been submitted effectively prior to that.  I accept that the return was not properly submitted on or around 31 January 2017, or prior to 12 September 2017.

DISCUSSION

42.  Relevant statutory provisions are included as an Appendix to this decision.

43.  I have concluded that the tax return for the 2015-16 tax year was not submitted on time.  It should have been submitted by 31 January 2017.  Subject to considerations of “reasonable excuse” and “special circumstances” set out below, the penalties imposed are due and have been calculated correctly.

44.  When a person appeals against a penalty they are required to have a reasonable excuse which existed for the whole period of the default. There is no definition in law of reasonable excuse, which is a matter to be considered in the light of all the circumstances of the particular case.  A reasonable excuse is normally an unexpected or unusual event, which prevents him or her from complying with an obligation which otherwise they would have complied with.

45.  The appellant tells me that she was unaware of the penalties until 2019 but she has not offered any explanation as to why she was unaware of the requirement to file in 2017.  Her return was submitted in 2017 but it was 224 days late.  Mrs Lasek has been self-employed and completing returns since 2013-14 so must have been aware that she would be required to file in January of 2017.

46.  She further stated in her notice of appeal that she became aware of the penalties when she set up her online account in January 2019, however, her letter of August 2019 states that she became aware in March upon receiving letters.  It matters little which date is accurate, save that the first effort to correspond with the Respondent is in April 2019 which is a significant delay if she became aware of the problem in January 2019.  It does seem unlikely that her registration in January would not have brought the penalties to her attention, had she been unaware of them before.

47.  The notice to file, both penalty notices and a number of statements of account were sent to her registered address.  Certainly the notice to file, both penalty notices and two statements of accounts would have reached their destination prior to the return being filed.  It is not clear to me whether the Appellant is stating that this documentation was not received, or whether she is stating that she ignored it.  Since she has also stated that she did not know about the penalties, I assume her case is that she didn’t receive any of the documentation.  Had she received the notice to file, she would have known she hadn’t done so.  And had she received either penalty notices or statements of account she would have known of the penalties.  I find it extremely unlikely that all of this correspondence has gone astray, particularly without any of it being returned undelivered.  Mrs Lasek has not told me of any postal difficulties at around the relevant time and I conclude that there were none.  I find it further unlikely that the correspondence would suddenly begin to arrive in March 2019 - as set out in the appellant’s letter dated August 2019 - when they had all failed to arrive previously.  In the circumstances I conclude that the documentation was properly sent and received at her registered address.

48.  There is some suggestion on the appeal notice that prior to January 2019 Mrs Lasek used an agent, but she has not told me of any correspondence or communication with this agent in relation to the filing of this tax return.  She has not indicated to me how this return came to be filed in September 2017 if she was unaware at that point that there was an issue with the return.  The Appellant’s reliance upon an agent cannot be a reasonable excuse unless she took reasonable care to ensure that her obligations were complied with.  The responsibility for complying with his tax obligations rests with her.  All of the correspondence was sent to the Appellant rather than her agent and if indeed the initial failure to file was the fault of the agent, it could have been rectified shortly after the notice of February 2017 was received.  In those circumstances, Mrs Lasek was plainly not acting with due diligence in dealing with her tax obligations. 

49.  In Perrin v HMRC [2018] UKUT 156, the Upper Tribunal explained that the experience and knowledge of the particular taxpayer should be taken into account.  The Upper Tribunal concluded that for an honestly held belief to constitute a reasonable excuse it must also be objectively reasonable for that belief to be held.  Had Mrs Lasek had an honest belief that her return had been filed on time (presumably by her unidentified agent), that belief ought to have been displaced by the February penalty notice.  I am satisfied that Mrs Lasek took insufficient action following the receipt of that document, suggesting that she was not paying due attention to her tax obligations.

50.  I conclude that Mrs Lasek does not have a reasonable excuse for the late filing of her return for 2015-16.

51.  Whilst I am sympathetic to Mrs Lasek’s family circumstances the amount of the penalties is set in legislation and her financial difficulties cannot in themselves constitute a reasonable excuse.

52.  Even when a taxpayer is unable to establish that he / she has a reasonable excuse and he / she remains liable for one or more penalties, HMRC have the discretion to reduce those penalties if they consider that the circumstances are such that reduction would be appropriate.  In this case HMRC have declined to exercise that discretion.

53.  Paragraph 22 of Schedule 55 provides that I am only able to interfere with HMRC’s decision on special reduction if I consider that their decision was flawed (in the sense understood in a claim for judicial review).  That is a high test and I do not consider that HMRC’s decision in this case (set out in their Statement of Case) is flawed.  Therefore, I have no power to interfere with HMRC’s decision not to reduce the penalties imposed upon the Appellant.

54.  I should add, that even if I did have the power to make my own decision in respect of special reduction, the only special circumstance which the appellant relied upon was her financial circumstances.  I have explained above why I do not consider that to provide Mrs Lasek with a reasonable excuse for her late filing.  Similarly, I conclude that an inability to pay cannot constitute a reason to reduce the penalties and ignorance of the severity of the Schedule 55 penalty regime does not constitute a special circumstance which would make it right for me to reduce the penalty which has been imposed.

CONCLUSION

55.  I therefore confirm the fixed penalties of £100, £900 and £300.

RIGHT TO APPLY FOR PERMISSION TO APPEAL

56.  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.

 

 

ABIGAIL HUDSON

TRIBUNAL JUDGE

 

RELEASE DATE: 6 MARCH 2020

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

APPENDIX

RELEVANT STATUTORY PROVISIONS

          Finance Act 2009

57.  The penalties at issue in this appeal are imposed by Schedule 55.  The starting point is paragraph 3 of Schedule 55 which imposes a fixed £100 penalty if a self-assessment return is submitted late.

58.  Paragraph 4 of Schedule 55 provides for daily penalties to accrue where a return is more than three months late as follows:

4—

(1)  P is liable to a penalty under this paragraph if (and only if) —

(a)  P’s failure continues after the end of the period of 3 months beginning with the penalty date,

(b)  HMRC decide that such a penalty should be payable, and

(c)  HMRC give notice to P specifying the date from which the penalty is payable.

(2)  The penalty under this paragraph is £10 for each day that the failure continues during the period of 90 days beginning with the date specified in the notice given under sub-paragraph (1)(c).

(3)  The date specified in the notice under sub-paragraph (1)(c)—

(a)  may be earlier than the date on which the notice is given, but

(b)  may not be earlier than the end of the period mentioned in sub-paragraph (1)(a).

59.  Paragraph 5 of Schedule 55 provides for further penalties to accrue when a return is more than 6 months late as follows:

5—

(1)  P is liable to a penalty under this paragraph if (and only if) P’s failure continues after the end of the period of 6 months beginning with the penalty date.

(2)  The penalty under this paragraph is the greater of —

(a)  5% of any liability to tax which would have been shown in the return in question, and

(b)  £300.

60.  Paragraph 6 of Schedule 55 provides for further penalties to accrue when a return is more than 12 months late as follows:

6—

(1)  P is liable to a penalty under this paragraph if (and only if) P’s failure continues after the end of the period of 12 months beginning with the penalty date.

(2)  Where, by failing to make the return, P deliberately withholds information which would enable or assist HMRC to assess P’s liability to tax, the penalty under this paragraph is determined in accordance with sub-paragraphs (3) and (4).

(3)  If the withholding of the information is deliberate and concealed, the penalty is the greater of —

(a)  the relevant percentage of any liability to tax which would have been shown in the return in question, and

(b)  £300.

(3A)  For the purposes of sub-paragraph (3)(a), the relevant percentage is—

(a)  for the withholding of category 1 information, 100%,

(b)  for the withholding of category 2 information, 150%, and

(c)  for the withholding of category 3 information, 200%.

(4)  If the withholding of the information is deliberate but not concealed, the penalty is the greater of —

(a)  the relevant percentage of any liability to tax which would have been shown in the return in question, and

(b)  £300.

(4A)  For the purposes of sub-paragraph (4)(a), the relevant percentage is—

(a)  for the withholding of category 1 information, 70%,

(b)  for the withholding of category 2 information, 105%, and

(c)  for the withholding of category 3 information, 140%.

(5)  In any case not falling within sub-paragraph (2), the penalty under this paragraph is the greater of —

(a)  5% of any liability to tax which would have been shown in the return in question, and

(b)  £300.

(6)  Paragraph 6A explains the 3 categories of information.

61.  Paragraph 23 of Schedule 55 contains a defence of “reasonable excuse” as follows:

23—

(1)  Liability to a penalty under any paragraph of this Schedule does not arise in relation to a failure to make a return 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.

62.  Paragraph 16 of Schedule 55 gives HMRC power to reduce penalties owing to the presence of “special circumstances” as follows:

16—

(1)  If HMRC think it right because of special circumstances, they may reduce a penalty under any paragraph of this Schedule.

(2)  In sub-paragraph (1) “special circumstances” does not include—

(a)  ability to pay, or

(b)  the fact that a potential loss of revenue from one taxpayer is balanced by a potential over-payment by another.

(3)  In sub-paragraph (1) the reference to reducing a penalty includes a reference to—

(a)  staying a penalty, and

(b)  agreeing a compromise in relation to proceedings for a penalty.

63.  Paragraph 20 of Schedule 55 gives a taxpayer a right of appeal to the Tribunal and paragraph 22 of Schedule 55 sets out the scope of the Tribunal’s jurisdiction on such an appeal.  In particular, the Tribunal has only a limited jurisdiction on the question of “special circumstances” as set out below:

22—

(1)  On an appeal under paragraph 20(1) that is notified to the tribunal, the tribunal may affirm or cancel HMRC's decision.

(2)  On an appeal under paragraph 20(2) that is notified to the tribunal, the tribunal may —

(a)  affirm HMRC’s decision, or

(b)  substitute for HMRC’s decision another decision that HMRC had power to make.

(3)  If the tribunal substitutes its decision for HMRC’s, the tribunal may rely on paragraph 16—

(a)  to the same extent as HMRC (which may mean applying the same percentage reduction as HMRC to a different starting point), or

(b)  to a different extent, but only if the tribunal thinks that HMRC’s decision in respect of the application of paragraph 16 was flawed.

(4)  In sub-paragraph (3)(b) “flawed” means flawed when considered in the light of the principles applicable in proceedings for judicial review.

 

64.  Section 8 - Personal return- provides as follows:

(1)   For the purpose of establishing the amounts in which a person is chargeable to income tax and capital gains tax for a year of assessment, [and the amount payable by him by way of income tax for that year,] he may be required by a notice given to him by an officer of the Board-

a)  to make and deliver to the officer, on or before the day mentioned in subsection (1A) below, a return containing such information as may, reasonably be required in pursuance of the notice, and

b)  to deliver with the return such accounts, statements and documents, relating to information contained in the return, as may reasonably be so required.

(1A) The day referred to in subsection (1) above is-

(a)  the 31st January next following the year of assessment, or

(b)  where the notice under the section is given after the 31st October next following the year, the last [day of the period of three months beginning with the day on which the notice is given]

(1AA) For the purposes of subsection (1) above-

(a) the amounts in which a person is chargeable to income tax and capital gains tax are net amounts, that is to say, amounts which take into account any relief or allowance a claim for which is included in the return; and

(b) the amount payable by a person by way of income tax is the difference between the amount in which he is chargeable to income tax and the aggregate amount of any income tax deducted at source and any tax credits to which [section 397(1) [or [397A(1)] of ITTOIA 2005] applies.]

(1B) In the case of a person who carries on a trade, profession, or business in partnership with one or more other persons, a return under the section shall include each amount which, in any relevant statement, is stated to be equal to his share of any income, [loss, tax, credit] or charge for the period in respect of which the statement is made.

(1C) In subsection (1B) above "relevant statement" means a statement which, as respects the partnership, falls to be made under section 12AB of the Act for a period which includes, or includes any part of, the year of assessment or its basis period.]

(1D) A return under the section for a year of assessment (Year 1) must be delivered-

(a) in the case of a non-electronic return, on or before 31st October in Year 2, and

(b) in the case of an electronic return, on or before 31st January in Year 2.

(1E) But subsection (1D) is subject to the following two exceptions.

(1F) Exception 1 is that if a notice in respect of Year 1 is given after 31st July in Year 2 (but on or before 31st October), a return must be delivered-

(a) during the period of 3 months beginning with the date of the notice (for a non-electronic return), or

(b) on or before 31st January (for an electronic return).

(1G) Exception 2 is that if a notice in respect of Year 1 is given after 31st October in Year 2, a return (whether electronic or not) must be delivered during the period of 3 months beginning with the date of the notice.

(1H) The Commissioners-

(a) shall prescribe what constitutes an electronic return, and

(b) may make different provision for different cases or circumstances.

(2) Every return under the section shall include a declaration by the person making the return to the effect that the return is to the best of his knowledge correct and complete.

(3) A notice under the section may require different information, accounts and statements for different periods or in relation to different descriptions of source of income.

(4) Notices under the section may require different information, accounts and statements in relation to different descriptions of person.

(4A)Subsection (4B) applies if a notice under the section is given to a person within section 8ZA of the Act (certain persons employed etc. by person not resident in United Kingdom who perform their duties for UK clients).

(4B)The notice may require a return of the person's income to include particulars of any general earnings (see section 7(3) of ITEPA 2003) paid to the person.

(5) In the section and sections 8A, 9 and 12AA of the Act, any reference to income tax deducted at source is a reference to income tax deducted or treated as deducted from any income or treated as paid on any income.