Porter v The Commissioner For Revenue and Customs (INCOME TAX/CORPORATION TAX : Penalty) [2016] UKFTT 401 (TC) (07 June 2016)

Porter v The Commissioner For Revenue and Customs (INCOME TAX/CORPORATION TAX : Penalty) [2016] UKFTT 401 (TC) (07 June 2016)

The Tribunal found that Mrs Porter had a reasonable excuse for late submission of both partnership and personal returns due to exclusion from business records and reliance on accountants. For late payment, her ability to pay was severely restricted by circumstances outside her control, but she could have made some earlier payments from modest available funds. Penalties for late submission were cancelled; penalty for late payment to be recalculated based on available capital during the relevant period.

Citation
[2016] UKFTT 401
Parties
Appellant: Eugena Porter; Respondents: The Commissioners for Her Majesty’s Revenue & Customs
Jurisdiction
United Kingdom
Judgment Date
07 June 2016
Procedural Posture
Income Tax/corporation Tax Penalty Appeal / First Tier Tribunal (tax Chamber) Final Decision
Outcome
Appeal allowed in part
Legal Topics
Income Tax, Corporation Tax, Penalties, Late Submission of Returns, Late Payment of Tax, Reasonable Excuse, Special Circumstances
Tax Law Income Tax Corporation Tax Penalties Late Submission of Returns Late Payment of Tax Reasonable Excuse Special Circumstances

Case Brief

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Parties

Eugena Porter

Appellant

The Commissioners for Her Majesty’s Revenue & Customs

Respondents

Procedural Posture

Income Tax/corporation Tax Penalty Appeal / First Tier Tribunal (tax Chamber) Final Decision

Legal Issues

  1. 1 Whether the appellant had a reasonable excuse for late submission of personal and partnership tax returns
  2. 2 Whether the appellant had a reasonable excuse for late payment of tax
  3. 3 Whether penalties for late submission and late payment were correctly imposed

Ratio Decidendi

The Tribunal found that Mrs Porter had a reasonable excuse for late submission of both partnership and personal returns due to exclusion from business records and reliance on accountants. For late payment, her ability to pay was severely restricted by circumstances outside her control, but she could have made some earlier payments from modest available funds. Penalties for late submission were cancelled; penalty for late payment to be recalculated based on available capital during the relevant period.

Court Disposition

Appeal allowed in part

Orders

  • Penalties for late submission of partnership and personal returns cancelled.
  • Penalty for late payment of tax to be recalculated in light of Tribunal's findings regarding available capital and reasonable excuse.