Exclusive Promotions Limited v The Commissioner for HMRC
[2023] UKUT 269 (TCC)
William Archer v The Commissioners For His Majesty’s Revenue And Customs
7 June 2023
[2023] EWCA Civ 626
Court of Appeal
Mr. Archer didn't pay his taxes because he was fighting HMRC in court. The court initially agreed he had a good reason, but he waited too long to pay after losing the court case, so he still has to pay the taxes plus penalties.
Key Facts
- •William Archer appeals surcharge notices totaling £1,403,181.78 for unpaid tax.
- •Archer claims a reasonable excuse for non-payment due to ongoing judicial review proceedings challenging HMRC closure notices.
- •HMRC closure notices were deemed defective for not stating the tax amount due.
- •Archer's judicial review was initially successful in obtaining interim relief, but ultimately dismissed by the Supreme Court.
- •Archer paid the tax after the Supreme Court's refusal of permission to appeal.
- •The Upper Tribunal (UT) dismissed Archer's appeal, finding insufficient evidence of why he didn't pay despite the judicial review.
Legal Principles
Reasonable excuse for non-payment of tax.
Section 59C(9) and (10) Taxes Management Act 1970 (TMA)
Deemed non-failure to pay if done within allowed time or with reasonable excuse and without unreasonable delay.
Section 118(2) TMA
Closure notices must state the amount of tax due.
Section 28A(2)(b) TMA
Postponement of tax payment pending appeal to the FTT.
Section 55 TMA
Accelerated Payment Notices (APNs): 'pay now, argue later' principle.
Finance Act 2014, Chapter 3, Part 4, Schedule 32
Reasonable excuse assessment considers objective facts and taxpayer's situation.
Christine Perrin v HMRC [2018] UKUT 0156 (TCC)
Inability to pay is not a reasonable excuse.
Section 59C(10) TMA
Outcomes
Appeal dismissed.
While Archer had a reasonable excuse for non-payment during the initial stages of the judicial review, the unreasonable delay in paying after the Court of Appeal's decision negated this.