Benjamin Simon Alan Cooke v The Commissioners for HMRC
[2023] UKFTT 369 (TC)
Gilad Kalchheim v The Commissioners for HMRC
11 August 2023
[2023] UKFTT 709 (TC)
First-tier Tribunal
Mr. Kalchheim got a penalty for paying his taxes late on a special child benefit tax. He said he didn't know about it and had trouble registering online to pay, but the judge said that wasn't a good enough reason, and he had to pay the penalty.
Key Facts
- •Mr. Gilad Kalchheim appealed a £135 late payment penalty for the High-Income Child Benefit Charge (HICBC) for the tax year ending 5 April 2021.
- •He failed to notify his chargeability to income tax within the six-month deadline (s 7 TMA).
- •His tax return was filed on time (30 March 2022), but payment was late (26 April 2022).
- •He claimed he was unaware of the HICBC until December 2021 and faced difficulties registering for self-assessment.
- •HMRC argued the penalty was correctly issued and no reasonable excuse existed.
Legal Principles
Time limit for notifying chargeability to income tax is six months from the end of the tax year (s 7 TMA).
Taxes Management Act 1970
Due date for income tax payment is 31 January following the year of assessment (s 59B TMA), unless exceptions apply.
Taxes Management Act 1970
Late payment penalties are governed by Schedule 56 of the Finance Act 2009.
Finance Act 2009
The burden of proof is on HMRC to show a penalty is due; then on the appellant to show a reasonable excuse.
Perrin v R & C Commrs [2018] BTC 513
Reasonable excuse is judged objectively, considering the taxpayer's experience and circumstances.
Clean Car Co. Ltd v C&E Commissioners [1991] VATTR 234
Ignorance of the law is not a reasonable excuse.
Hesketh & Anor v HMRC [2018] TC 06266, Spring Capital v HMRC [2015] UKFTT 8 (TC), Lau v HMRC [2018] UKFTT 230 (TC)
HMRC has no statutory duty to notify all taxpayers potentially affected by HICBC.
Johnstone v HMRC [2018] UKFTT 0689 (TC)
Outcomes
Appeal dismissed.
The Appellant failed to meet the statutory deadline for notifying his HICBC liability and did not establish a reasonable excuse for the late payment. HMRC's actions were deemed lawful and the penalty correctly applied.