Lalji Vekaria v The Commissioners for HMRC
[2023] UKFTT 288 (TC)
Jason Nicholas James v The Commissioners for HMRC
31 July 2023
[2023] UKFTT 661 (TC)
First-tier Tribunal
Someone tried to appeal late tax penalties, but waited too long (6-18 months!). Even though he had problems with his accountant and HMRC, and faced hard times, the judge said you can't ignore the rules about appealing on time.
Key Facts
- •Appellant applied for permission to make late appeals against late payment penalties (£21,141) for 2016/17, 2017/18, and 2018/19.
- •Appeals were significantly late (delays exceeding 6-18 months).
- •Appellant claimed his accountant advised appealing penalties only after full tax payment; HMRC did not inform him otherwise.
- •Appellant faced financial hardship and difficulty communicating with HMRC, partly due to Covid-19.
- •HMRC's documentation was incomplete, raising uncertainty about evidence in a potential substantive appeal.
Legal Principles
Appeals must be made within 30 days of penalty assessment (Section 31A Taxes Management Act 1970).
Taxes Management Act 1970
Late appeals may be permitted if HMRC agrees or the Tribunal grants permission (Section 49 Taxes Management Act 1970).
Taxes Management Act 1970
Late appeal applications must include reasons for delay (Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009).
Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009
Three-stage approach for late appeal applications: (1) assess delay length, (2) establish reasons, (3) evaluate all circumstances, including prejudice and efficiency (Martland v HMRC [2018] UKUT 178 (TCC)).
Martland v HMRC [2018] UKUT 178 (TCC)
Adviser failures are generally treated as litigant failures (HMRC v Katib [2019] STC 2106).
HMRC v Katib [2019] STC 2106
Lack of funds is generally not a reasonable excuse for late appeal, except in limited circumstances (Schedule 56 Finance Act 2009).
Schedule 56 Finance Act 2009
Outcomes
Application for permission to make late appeals dismissed.
Appellant failed to provide a good reason for the significant delays; reliance on accountant's advice is insufficient. Covid-19 difficulties and financial hardship do not excuse the late appeals.