Validity of penalty notices

Reasonable excuse for late-filed return

On 6 April 2011 HMRC issued the taxpayer a notice to file a 2010-11 tax return. The deadline was 31 January 2012 but he filed it on 16 August 2013. In the meantime HMRC issued late-filing penalties. The taxpayer appealed. He said the return was late because he had been in prison between February 2012 and February 2013.

The First-tier Tribunal accepted that going to prison was ‘an unusual event beyond the appellant’s control’ and that it would make it difficult to deal with his tax affairs. The deadline for the return was before the taxpayer’s incarceration but the judge said ‘de-imprisonment events’ would have pre-occupied him. Further he said HMRC had produced no evidence to show the taxpayer had received a reminder to file the return or the penalty notices. So he concluded that the taxpayer had a reasonable excuse...