Hayley Farmer v The Commissioners for HMRC
Decision date: 2 September 2024
Neutral citation: [2024] UKFTT 790 (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 Schedule 55 penalties for late filing of a tax return; the appellant posted her return to an HMRC‑associated but unusable address and HMRC did not receive it until many months later. The Tribunal found that posting to that address constituted a reasonable excuse up to the date the first penalty notice was received (14 February 2023) but that the reasonable excuse ended on receipt of that notice and the appellant unreasonably delayed in remedying the failure. The initial £100 penalty was set aside; the daily penalties (£900) and six‑month penalty (£300) were 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: high
The tribunal applied that sending a return to an address associated with HMRC but not a valid/usable address can amount to a reasonable excuse for late filing up to the point at which the taxpayer becomes aware (for example by receipt of a penalty notice) that the return was not received; once the taxpayer has such notice a reasonable excuse ordinarily ends and the taxpayer must promptly remedy the defect or face continued penalties.
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 (non‑bindingly) that the threshold for finding “special circumstances” warranting reduction of penalties under para.16 is high and that lack of tax liability alone is not normally a special circumstance; it also noted that inadvertent mistake or bona fide muddle will not necessarily amount to a reasonable excuse.