Bayleaf Cleaning v Revenue & Customs [2014] UKFTT 946 (TC) (08 October 2014)

Bayleaf Cleaning v Revenue & Customs [2014] UKFTT 946 (TC) (08 October 2014)

The appellant failed to discharge the burden of proof to show a reasonable excuse for late VAT payments for periods 10/10, 01/11, and 07/11. However, for period 10/11, the direct debit was set up but not applied by HMRC after timely submission of the return, constituting a reasonable excuse. The surcharges were not disproportionate or excessive.

Citation
[2014] UKFTT 946 (TC)
Parties
Appellant: Bayleaf Cleaning Ltd; Respondents: The Commissioners for Her Majesty’s Revenue & Customs
Jurisdiction
United Kingdom
Judgment Date
08 October 2014
Procedural Posture
VAT Default Surcharge Appeal / First Tier Tribunal (tax Chamber) Decision
Outcome
Appeal allowed in part
Legal Topics
VAT Default Surcharge, Reasonable Excuse, Proportionality of Penalties, Late Payment of VAT
Tax Law VAT Default Surcharge Reasonable Excuse Proportionality of Penalties Late Payment of VAT

Case Brief

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Parties

Bayleaf Cleaning Ltd

Appellant

The Commissioners for Her Majesty’s Revenue & Customs

Respondents

Procedural Posture

VAT Default Surcharge Appeal / First Tier Tribunal (tax Chamber) Decision

Legal Issues

  1. 1 Whether the appellant had a reasonable excuse for late VAT payments for periods 10/10, 01/11, 07/11, and 10/11
  2. 2 Whether the surcharges imposed were disproportionate or excessive

Ratio Decidendi

The appellant failed to discharge the burden of proof to show a reasonable excuse for late VAT payments for periods 10/10, 01/11, and 07/11. However, for period 10/11, the direct debit was set up but not applied by HMRC after timely submission of the return, constituting a reasonable excuse. The surcharges were not disproportionate or excessive.

Court Disposition

Appeal allowed in part

Orders

  • Surcharges for periods 10/10, 01/11, and 07/11 confirmed
  • Surcharge for period 10/11 discharged