Penalty imposed for late paid partner payment notice

The taxpayer participated in the limited liability partnership Ingenious Film Partners. The partnership claimed trading losses and the taxpayer wished to carry back his share to reduce his income for an earlier year. After an enquiry into the partnership’s return HMRC issued a closure notice reducing the trading loss to nil. The partnership appealed.

HMRC issued a partner payment notice (PPN) to the taxpayer requiring him to pay £100 000. He challenged the notice but HMRC rejected his representations. It imposed a penalty notice for non-payment of the PPN against which the taxpayer appealed.

The First-tier Tribunal concluded it had no jurisdiction to consider the taxpayer’s argument that the PPN was excessive. Further the taxpayer had no reasonable excuse for paying the tax late. The Upper Tribunal confirmed this decision. The taxpayer appealed.

Lady Justice Simler delivered the Court of Appeal’s judgment. She said the accelerated payment notice (APN)...