R P Griffin & D M Griffen v Commissioners for Her Majesty's Revenue and Customs

Decision date: 13 May 2010

Neutral citation: [2010] UKFTT 220 (TC)

Overall AI summary confidence: medium

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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: medium

The Griffins appealed a VAT default surcharge for period 08/08 imposed after a late payment; the Tribunal found they did not have a reasonable excuse for the 08/08 default but did have a reasonable excuse for an earlier 02/08 default because they entered into and complied with a Time to Pay arrangement. Applying the Aardvark approach, the Tribunal treated the 02/08 default as if it had not occurred for surcharge calculation, reducing the applicable rate from 10% to 5% and halving the surcharge from £665.62 to £332.81. The appeal was allowed in part.

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

A tribunal may take into account a reasonable excuse for an earlier default (which would otherwise increase the surcharge rate) when that earlier default affects the calculation of the surcharge for the default under appeal; furthermore, ordinary insufficiency of funds in a cash business that has collected VAT is unlikely to constitute a reasonable excuse for late payment.

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 indicated that practical business pressures such as banking difficulties, change of bank manager or increased workload do not automatically amount to a reasonable excuse for late VAT payment, and endorsed a "wider approach" to s.59 VATA consistent with the Aardvark decision.

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Chunk contains substantial repetition and duplicated passages. Notes contain substantial repetition and duplicated passages.

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