HR Transport Services Ltd v Revenue & Customs [2014] UKFTT 90 (TC) (13 January 2014)

HR Transport Services Ltd v Revenue & Customs [2014] UKFTT 90 (TC) (13 January 2014)

The appellant acted reasonably in relying on established banking practices, and there was no indication that the payment would not be processed as usual. Therefore, it was reasonable to expect the VAT payment would be received on time, and the default surcharge should be removed under s 59(7)(a) VATA 1994.

Citation
[2014] UKFTT 90
Parties
Appellant: HR Transport Services Ltd; Respondents: The Commissioners for Her Majesty’s Revenue & Customs
Jurisdiction
United Kingdom
Judgment Date
13 January 2014
Procedural Posture
VAT Default Surcharge Appeal / First Tier Tribunal (tax Chamber) Decision
Outcome
Appeal allowed
Legal Topics
VAT Default Surcharge, Reasonable Excuse, Late Payment, Banking Practices
Tax Law VAT Default Surcharge Reasonable Excuse Late Payment Banking Practices

Case Brief

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Parties

HR Transport Services 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 payment of VAT under s 59(7)(a) or (b) VATA 1994
  2. 2 Whether reliance on established banking practices constitutes reasonable expectation of timely payment

Ratio Decidendi

The appellant acted reasonably in relying on established banking practices, and there was no indication that the payment would not be processed as usual. Therefore, it was reasonable to expect the VAT payment would be received on time, and the default surcharge should be removed under s 59(7)(a) VATA 1994.

Court Disposition

Appeal allowed

Orders

  • Default surcharge for the 08/11 VAT period is removed.