Warrens Display Ltd v Revenue & Customs [2012] UKFTT 153 (TC) (22 February 2012)

Warrens Display Ltd v Revenue & Customs [2012] UKFTT 153 (TC) (22 February 2012)

The Tribunal found that the appellant did not discharge the burden of proving that the late payment was due to unforeseen circumstances beyond its control, and that a prudent taxpayer could have avoided the insufficiency of funds. The underlying cause was not exceptional, and the appellant had a history of late payments. Therefore, no reasonable excuse was established under s 59(7)(b) VATA 1994.

Citation
[2012] UKFTT 153
Parties
Appellant: Warrens Display Ltd; Respondents: The Commissioners for Her Majesty’s Revenue & Customs
Jurisdiction
United Kingdom
Judgment Date
22 February 2012
Procedural Posture
VAT Default Surcharge Appeal / First Tier Tribunal (tax Chamber) Decision
Outcome
Appeal dismissed
Legal Topics
VAT, Default Surcharge, Reasonable Excuse, Insufficiency of Funds
Tax Law VAT Default Surcharge Reasonable Excuse Insufficiency of Funds

Case Brief

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Parties

Warrens Display 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)(b) VATA 1994
  2. 2 Whether insufficiency of funds due to a bad debt constitutes a reasonable excuse

Ratio Decidendi

The Tribunal found that the appellant did not discharge the burden of proving that the late payment was due to unforeseen circumstances beyond its control, and that a prudent taxpayer could have avoided the insufficiency of funds. The underlying cause was not exceptional, and the appellant had a history of late payments. Therefore, no reasonable excuse was established under s 59(7)(b) VATA 1994.

Court Disposition

Appeal dismissed

Orders

  • Default surcharge of £1,058.45 confirmed