S W McMullan v Commissioners for Her Majesty's Revenue and Customs
Decision date: 15 December 2009
Neutral citation: [2009] UKFTT 367 (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 whether Mr McMullan was in default for late payment surcharge purposes for 2006/07 when HMRC levied a surcharge. The Tribunal found that default is assessed at the start of the relevant surcharge-assessment day and that the tax had been paid by that time (and only later refunded), so there was no default and no surcharge should have been levied. The appeal was allowed and HMRC may seek permission to appeal.
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 held that for surcharge purposes a taxpayer is in default only if tax remains unpaid at the start of the relevant assessment day; payment made before that time prevents default. Consequently the question of whether the taxpayer had a reasonable excuse only arises if there is an actual default to consider.
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 (drawing on Thompson v Minzly) that payment made later on the relevant day after its start could still result in a surcharge, and it rejected HMRC’s contention that a later refund at the taxpayer’s request meant the earlier payment should not count as payment for surcharge purposes.