Desmond Magee & Sons (A Partnership) v Commissioners for Her Majesty's Revenue and Customs
Decision date: 29 September 2010
Neutral citation: [2010] UKFTT 456 (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
Desmond Magee & Sons appealed HMRC's withdrawal of their gross payment status under the CIS after a scheduled review that recorded six late PAYE payments by the two partners. The Tribunal found the defaults occurred, that they exceeded the de minimis threshold, and rejected the partnership's claim of reasonable excuse based on delayed payments from the Northern Ireland Housing Executive and use of government time-to-pay arrangements; the appeal was dismissed and gross status withdrawn.
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 taxpayer bears the onus of proving a reasonable excuse for defaults when a compliance test for gross payment status is failed; late payment by a contracting public authority will only constitute a reasonable excuse in exceptional circumstances and where the authority's delay adequately explains the taxpayer's failure to pay by the due date.
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 regret at the harsh commercial effects of strict CIS enforcement in difficult economic conditions and noted government time-to-pay initiatives, but said it could not take the likely business impact of withdrawal of gross status into account in its decision.