Bannister Combined Services v Commissioners for Her Majesty's Revenue and Customs
Decision date: 12 April 2010
Neutral citation: [2010] UKFTT 158 (TC)
Overall AI summary confidence: medium
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
This appeal concerned HMRC's withdrawal of a partnership's gross payment status after partners made late self-assessment payments. The tribunal found the partners had an honestly held belief in an informal arrangement with the local inspector and longstanding cash-flow difficulties caused by late-paying public-sector clients; together these amounted to a "reasonable excuse" under paragraph 8(3) Schedule 11. The appeal was allowed and gross payment status was not withdrawn.
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 treated as decisive that an honestly held belief in an informal arrangement with a tax inspector, when supported by a consistent pattern of prior conduct and long-standing cash-flow problems caused by third-party late payments, can amount to a reasonable excuse under paragraph 8(3) Schedule 11 and therefore satisfy the compliance test.
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 noted that HMRC's failure to take collection action does not conclusively prove an agreement but is consistent with there having been an informal arrangement; and that a later imposition of a surcharge may be too late to negate an honestly held belief formed at the time of default.