Bushell v Revenue & Customs [2010] UKFTT 577 (TC) (16 November 2010)

Bushell v Revenue & Customs [2010] UKFTT 577 (TC) (16 November 2010)

Mr Bushell was liable for penalties only for periods when he was a person who 'makes payments' under construction contracts and failed to file required returns without reasonable excuse. Reliance on an agent is not a reasonable excuse unless the failure was due to exceptional circumstances. For certain periods, reasonable excuse applied due to misleading information from HMRC or lack of ongoing arrangements. Penalties were reduced accordingly.

Citation
[2010] UKFTT 577 (TC)
Parties
Appellant: Giles Bushell; Respondents: The Commissioners for Her Majesty’s Revenue and Customs
Jurisdiction
United Kingdom
Judgment Date
16 November 2010
Procedural Posture
Tax Appeal / First Tier Tribunal (tax) Decision
Outcome
Appeal allowed in part; penalties reduced.
Legal Topics
Construction Industry Scheme, Income Tax, Corporation Tax, Penalties for Late Returns, Reasonable Excuse, Reliance on Agent, Proportionality, Human Rights
Tax Law Construction Industry Scheme Income Tax Corporation Tax Penalties for Late Returns Reasonable Excuse Reliance on Agent Proportionality +1 more

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Parties

Giles Bushell

Appellant

The Commissioners for Her Majesty’s Revenue and Customs

Respondents

Procedural Posture

Tax Appeal / First Tier Tribunal (tax) Decision

Legal Issues

  1. 1 Whether Mr Bushell was liable for penalties for failure to make monthly CIS returns for periods when no subcontractors were engaged
  2. 2 Whether reliance on an agent constitutes a reasonable excuse for failure to file returns
  3. 3 Whether penalties imposed were proportionate and compatible with human rights law

Ratio Decidendi

Mr Bushell was liable for penalties only for periods when he was a person who 'makes payments' under construction contracts and failed to file required returns without reasonable excuse. Reliance on an agent is not a reasonable excuse unless the failure was due to exceptional circumstances. For certain periods, reasonable excuse applied due to misleading information from HMRC or lack of ongoing arrangements. Penalties were reduced accordingly.

Court Disposition

Appeal allowed in part; penalties reduced.

Orders

  • Penalties reduced to £700 for 2007/8 Period 7, £600 for 2007/8 Period 8, £500 for 2007/8 Period 9, and £100 for 2008/9 Period 9.
  • Appellant permitted to make further representations on proportionality within 21 days of decision release.