Andrew Newall v The Commissioners for HMRC
[2024] UKFTT 47 (TC)
Naila Hussain v The Commissioners for HMRC
21 June 2023
[2023] UKFTT 545 (TC)
First-tier Tribunal
HMRC told Ms. Hussain about a tax she owed. She didn't pay it right away, and even though she had some good reasons at first, she waited too long to fix it. The judge said she has to pay the tax and the late fees.
Key Facts
- •Ms. Hussain was assessed HICBC for tax years 2014/15 to 2019/20 and penalties for late filing.
- •HMRC issued a 'nudge' letter in November 2019, informing her of potential HICBC liability.
- •Ms. Hussain's adjusted net income exceeded £50,000 from 2014/15, making her liable to HICBC.
- •She did not file her 2020/21 tax return.
- •Ms. Hussain claimed reasonable excuse due to unawareness of HICBC and subsequent health issues.
Legal Principles
HICBC liability
Income Tax (Earnings and Pensions) Act 2003, section 681B
Discovery assessments
Taxes Management Act 1970, section 29
Failure to notify penalties
Schedule 41, Finance Act 2008
Late filing penalties
Schedule 55, Finance Act 2009
Reasonable excuse
Taxes Management Act 1970, section 118(2); Perrin v HMRC [2018] UKUT 156; Archer v HMRC [2023] EWCA Civ 626
Special circumstances (penalty reduction)
Schedule 41, paragraph 14; Schedule 55, paragraph 16
Outcomes
Appeal dismissed regarding tax assessments.
Ms. Hussain's reasonable excuse ceased upon receiving the nudge letter, and she did not remedy the situation without unreasonable delay.
Appeal dismissed regarding late filing penalties.
While Ms. Hussain's health issues caused delays, the reasonable excuse ended, and unreasonable delay continued after her health improved.