Peter Marano v Commissioners for HMRC

Peter Marano v Commissioners for HMRC

The Upper Tribunal held that, due to the retrospective effect of s.103 Finance Act 2020, HMRC's automated notices and penalty assessments are valid without the need for specific officer authorisation. Notification of penalty assessments was sufficient as Mr Marano received actual notice, satisfying the statutory...

Source-derived case information.

Parties
Appellant: Peter Marano; Respondents: Commissioners for HM Revenue & Customs
Jurisdiction
England and Wales
Judgment Date
18 May 2023
Procedural Posture
Tax Appeal / Appeal From First Tier Tribunal to Upper Tribunal
Outcome
Appeal allowed in part; remitted to new FTT panel for reconsideration of special circumstances.
Legal Topics
Automated Tax Notices, Penalty Assessments, Service of Penalty Notices, Special Circumstances for Penalty Reduction, Interpretation of Finance Act 2020 S.103, Self Assessment Returns
Tax Law Automated Tax Notices Penalty Assessments Service of Penalty Notices Special Circumstances for Penalty Reduction Interpretation of Finance Act 2020 S.103 Self Assessment Returns

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Summary, issues, holding and outcome

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Parties

Peter Marano

Appellant

Commissioners for HM Revenue & Customs

Respondents

Procedural Posture

Tax Appeal / Appeal From First Tier Tribunal to Upper Tribunal

Legal Issues

  1. 1 Whether a valid notice to file a tax return was issued by an officer of HMRC under s.8 TMA 1970 and Sched 55 para 18
  2. 2 Whether penalty notices were properly notified to the taxpayer under Sched 55 para 18
  3. 3 Whether computation of tax-geared penalties under Sched 55 paras 5 and 6 should take into account prepayments of tax

Ratio Decidendi

The Upper Tribunal held that, due to the retrospective effect of s.103 Finance Act 2020, HMRC's automated notices and penalty assessments are valid without the need for specific officer authorisation. Notification of penalty assessments was sufficient as Mr Marano received actual notice, satisfying the statutory purpose. Tax-geared penalties are to be calculated based on the liability shown in the return, not reduced by prepayments. However, the FTT erred in law by failing to consider as relevant the early payment of tax, HMRC's prior knowledge of the liability, and the size of the penalties when determining 'special circumstances' for penalty reduction. The matter is remitted to a new...

Court Disposition

Appeal allowed in part; remitted to new FTT panel for reconsideration of special circumstances.

Orders

  • Appeal allowed on Ground 4 only.
  • Matter remitted to a differently constituted First-tier Tribunal to consider whether special circumstances exist justifying reduction of tax-geared penalties, taking into account early payment, HMRC's prior knowledge, and penalty size.