Edward Chatterton v Commissioners for Her Majesty's Revenue and Customs
Decision date: 1 February 2010
Neutral citation: [2010] UKFTT 147 (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 concerns the withdrawal of Edward Chatterton’s Gross Payment Status under the Construction Industry Scheme after multiple late tax payments in the qualifying period 19/07/07–18/07/08. The First-tier Tribunal found the Appellant non‑compliant with the CIS tax compliance test and rejected his reliance on an earlier large bad debt as a reasonable excuse for the late payments. The appeal was dismissed and no costs were awarded.
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 the CIS compliance test strictly: repeated or substantial late payments outside the prescribed tolerances amount to non‑compliance, and an earlier bad debt will not amount to a reasonable excuse for later non‑compliance unless the specific evidence shows it did so in the particular case. Potential business hardship from withdrawing Gross Payment Status is not a permissible ground to set aside non‑compliance.
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 and suggested that, in some other factual circumstances, a bad debt might amount to a reasonable excuse, and that factors such as VAT recoverability and contractual retentions can affect the assessed impact of a bad debt; however, those points did not alter the decision here.
Warning
Chunk is repetitive and contains duplicated passages; some figures (£200,000 v £120,000) are inconsistent in the material. Notes show some duplication and inconsistent figures for the alleged bad debt (c.£200,000 v nearer £120,000); the record may be incomplete.