Robert Ward t/a WPS Electrics v Commissioners for Her Majesty's Revenue and Customs
Decision date: 24 March 2011
Neutral citation: [2011] UKFTT 207 (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
This appeal concerned a 15% default surcharge of £916.35 imposed for late VAT payment for the period 01/05/10–31/07/10; the Appellant paid late and appealed out of time but was granted permission to be heard. The Tribunal rejected the Appellant’s grounds of lack of knowledge of the surcharge regime, non‑receipt of HMRC notices, and cash‑flow problems, finding on the balance of probabilities that notices were sent and received, that available funds could have been reallocated or supplemented, and that the surcharge was not disproportionate. The appeal was dismissed and the surcharge upheld.
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: medium
The Tribunal applied that unfamiliarity with the VAT default surcharge regime is not a reasonable excuse for late payment; where correspondence is sent to the taxpayer’s registered address and evidence shows conduct consistent with receipt, the Tribunal may find notice was received on the balance of probabilities; and general cash‑flow insufficiency will not be a reasonable excuse if funds could reasonably have been made available or supplemented.
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 decision contains observations that taxpayers bear some responsibility to make enquiries (for example via courses or HMRC helplines) to understand compliance obligations, and that the availability of private funds or transfers between accounts can be relevant when assessing whether insufficiency of funds was excusable.