Paul Baron v The Commissioners for HMRC

Decision date: 26 January 2024

Neutral citation: [2024] UKFTT 102 (TC)

Overall AI summary confidence: high

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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 HMRC discovery assessments and failure-to-notify penalties for the Higher Income Child Benefit Charge (HICBC) for 2015/16–2019/20. The Tribunal found Mr Baron was unaware of HICBC until 2021 and that discovery assessments for 2017/18–2019/20 were within time and stand, while those for 2015/16 and 2016/17 were time-barred and cancelled. The Tribunal upheld failure-to-notify penalties because any reasonable excuse ended when HMRC correspondence was received in January 2021 and the appellant did not remedy the position without unreasonable delay.

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

A taxpayer’s personal circumstances can make ignorance of HICBC objectively reasonable such that HMRC cannot rely on extended assessment time limits for earlier years; however, receipt of clear HMRC correspondence explaining the charge can end a reasonable excuse, and failure to act after that point can justify penalties for failure to notify.

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 suggested (obiter) that a public information campaign about a charge does not necessarily create an expectation that all taxpayers with particular personal circumstances should be aware of the charge, and that it would not comment on HMRC’s wider administrative practice beyond the legality of the assessments and penalties in this case.

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