Contentisking Ltd v Revenue & Customs (VAT - PENALTIES : Reasonable excuse) [2019] UKFTT 64 (TC) (28 January 2019)

Contentisking Ltd v Revenue & Customs (VAT - PENALTIES : Reasonable excuse) [2019] UKFTT 64 (TC) (28 January 2019)

The appellant's failure to be aware of the bank's same day transfer limit does not amount to a reasonable excuse, as a responsible trader would have ensured awareness of such limits, especially when already subject to the default surcharge regime. The penalty imposed is not disproportionate, as the facts do not constitute a wholly exceptional case under binding Upper Tribunal authority.

Citation
[2019] UKFTT 64
Parties
Appellant: Contentisking Limited; Respondents: The Commissioners for Her Majesty’s Revenue & Customs
Jurisdiction
United Kingdom
Judgment Date
28 January 2019
Procedural Posture
VAT Default Surcharge Appeal / First Tier Tribunal (tax Chamber) Decision
Outcome
Appeal dismissed
Legal Topics
VAT Default Surcharge, Reasonable Excuse, Proportionality of Penalties, Late Payment of Tax, Penalty Calculation
Tax Law Administrative Law European Union Law VAT Default Surcharge Reasonable Excuse Proportionality of Penalties Late Payment of Tax Penalty Calculation

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Parties

Contentisking Limited

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 payment of VAT
  2. 2 Whether the penalty imposed was disproportionate to the gravity of the infringement

Ratio Decidendi

The appellant's failure to be aware of the bank's same day transfer limit does not amount to a reasonable excuse, as a responsible trader would have ensured awareness of such limits, especially when already subject to the default surcharge regime. The penalty imposed is not disproportionate, as the facts do not constitute a wholly exceptional case under binding Upper Tribunal authority.

Court Disposition

Appeal dismissed

Orders

  • The default surcharge liability of £4,670.11 is upheld.