Auko Limited v Commissioners for Her Majesty's Revenue and Customs
Decision date: 15 March 2011
Neutral citation: [2011] UKFTT 176 (TC)
Overall AI summary confidence: high
Short overview
This short overview is intended to summarise the case, issues and outcome so far as they are supported by the judgment.
AI confidence in this short overview: high
Auko Limited appealed against an £800.27 VAT surcharge for late payment of VAT due 30 September 2009; the VAT was paid in two tranches on 8 and 9 October 2009. The director gave unchallenged evidence that payment was delayed by bank transfer limits and her inability to authorise earlier payment, but the Tribunal held those facts did not amount to a reasonable excuse. The Tribunal therefore upheld the surcharge and found it not disproportionate.
Ratio decidendi
This summary is intended to identify the ratio decidendi, meaning the legal reasons for deciding and the binding part of the decision.
AI confidence in this ratio decidendi summary: high
The Tribunal’s decision rests on the finding that showing funds were available and a lack of deliberate delay does not necessarily constitute a reasonable excuse for late VAT payment where the taxpayer was on notice of the surcharge consequences; foreseeable risks from last-minute arrangements (such as daily transfer limits) do not excuse late payment in those circumstances.
Obiter dicta
This summary is intended to identify obiter dicta, meaning observations made by the way that were not necessary to deciding the case and are not binding.
AI confidence in this obiter dicta summary: medium
The Tribunal observed that the appellant had over a month plus seven days to make arrangements and chose not to make a protective or provisional payment, and noted the appellant later moved from accruals to cash invoicing as a practical step to avoid recurrence; these comments were observational and not dispositive to the legal conclusion.