Michael Fallon v Commissioners for Her Majesty's Revenue and Customs
Decision date: 19 April 2011
Neutral citation: [2011] UKFTT 262 (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 challenged a 5% surcharge (£84.80) on £1,696 unpaid income tax for 2008–09 after HMRC had erroneously removed a fuel benefit from the appellant's PAYE coding. The tribunal found the appellant had no reasonable excuse for the whole period of default (any reasonable excuse ended on 18 February 2010), accepted HMRC's objective justification for treating returns filed after 30 December differently, and dismissed the appeal. The surcharge was therefore upheld, though HMRC retains discretion to mitigate.
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 dispositive that a taxpayer's inability to pay (lack of funds) is not a "reasonable excuse" under TMA s59C(10), and that administrative constraints (such as the 30 December deadline after which tax cannot be collected via PAYE coding) can objectively justify differential treatment of later filers for surcharge purposes.
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 expressed doubt about earlier authority suggesting surcharges under s59C fall outside protection of the Convention but did not decide the point; it also noted that s59C(11) gives HMRC discretion to mitigate or remit surcharges and that the Tribunal has no jurisdiction to review HMRC's exercise of that discretion.
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