Sellathamby Sivarajah v The Commissioners for HMRC
Decision date: 29 April 2026
Neutral citation: [2026] UKFTT 649 (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 an HMRC penalty under the Money Laundering Regulations 2017 for trading while unregistered: Mr Sivarajah traded as a self-employed bookkeeper from April to November 2022 without registering and HMRC imposed a penalty under Regulation 76. The Tribunal found he had not taken "all reasonable steps" or exercised "all due diligence" because he failed to resolve his uncertainty by contacting HMRC or his supervisory body, and so Regulation 76(4) did not bar a penalty. The Tribunal also held the penalty, calculated under HMRC’s authorised Penalties Framework and reduced for voluntary registration and timely payment, was appropriate, proportionate and dissuasive. The appeal was dismissed and the penalty confirmed.
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 judgment supports the proposition that where a person is aware of a possible registration obligation but does not resolve that uncertainty by contacting the supervisory authority or HMRC, they may fail to show they took "all reasonable steps" and exercised "all due diligence" under Regulation 76(4); accordingly a penalty may properly be imposed. The decision also indicates that penalties derived from an authorised penalties framework that account for profit and voluntary disclosure can satisfy requirements to consider financial strength and proportionality.
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 views (not strictly binding) that the requirement for a penalty to be "dissuasive" can be read broadly to include deterrence of businesses generally, and that lack of intent and absence of financial benefit do not, by themselves, prevent the imposition of a penalty under the Regulations.
Warning
- The chunk contains extensive repetition of material (duplicated paragraphs), but the substance of the decision is clear.