Gregorio Napoleone v The Commissioners for HMRC
Decision date: 16 January 2026
Neutral citation: [2026] UKFTT 130 (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 56 late payment penalties after Mr Napoleone filed a 2021/22 return showing tax of £4,276,119.43 and paid it 188 days late; penalties totalling £219,284 were imposed. The tribunal refused to admit late witness material filed shortly before the hearing, found Mr Napoleone did not have a "reasonable excuse" for late payment because his lack of funds was within his control (he had delayed securing borrowing and chose other priorities), and dismissed the appeal with the penalties 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 two key legal findings: (1) materially late disclosure of witness evidence and supporting documents shortly before a hearing may be refused admission and given no weight where procedural directions were not followed and no satisfactory excuse for late service is shown; and (2) for Schedule 56 purposes an insufficiency of funds will not amount to a "reasonable excuse" where the taxpayer’s decisions (for example failing to hold reserves, prioritising other liabilities, or delaying available borrowing) mean the shortage is attributable to events within the taxpayer’s control.
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 judgment contained comments indicating that certain investment risks (for example arising from war) are inherently foreseeable and that taxpayers may be expected to manage their consequences; and that it is common and reasonable in partnerships to retain drawings to cover liabilities, with absence of evidence of such provision being relevant to assessments of reasonableness. These remarks were exploratory rather than central to the decision.