Shivsagar Enterprises Ltd v The Commissioners for HMRC
Decision date: 9 December 2022
Neutral citation: [2022] UKFTT 22 (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 £400 late filing penalty under Schedule 55 FA 2009 for an SDIL quarterly return that was filed four days late. The appellant relied on an alleged HMRC online service malfunction as a reasonable excuse but failed to produce promised evidence and did not remedy any short-lived problem without unreasonable delay. The First-tier Tribunal found the statutory penalty applied, rejected the reasonable-excuse defence and, substituting for HMRC, found no special circumstances to reduce the penalty; the £400 penalty was 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 Schedule 55 FA 2009 to hold that a third or subsequent default within an extended penalty period attracts the statutory £400 penalty under para 13C(6); once HMRC proves liability, the taxpayer must prove a reasonable excuse on the balance of probabilities using an objective, fact-sensitive test. Further, where HMRC’s decision on special circumstances is flawed, the Tribunal may substitute its own decision and can uphold or reduce the penalty as appropriate.
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 treated authorities on the objective reasonable-excuse test (including Perrin and Clean Car Company) and guidance on “special circumstances” as persuasive. It also noted that transient or minor website login difficulties, without supporting evidence and prompt remedial action, will not typically establish a reasonable excuse.