No Reasonable Excuse for Taxpayer's Late Appeal

Taxpayers would be well advised to give prompt attention to any correspondence they receive from HM Revenue and Customs (HMRC). In a recent case, a man who appealed tax assessments and penalties several months late failed to convince the First-tier Tribunal (FTT) that he had a reasonable excuse for the delay.

HMRC had issued Income Tax assessments and associated penalties in April 2021, due to the man's failure to notify and declare tax due under the Higher Income Child Benefit Charge (HICBC). He had 30 days to appeal the assessments, but did not notify HMRC of his intention to do so until January 2022. After HMRC refused to accept his late appeal, he applied to the FTT for permission to make the appeal late.

The man had incorrectly assumed that the HICBC did not apply when child benefit was claimed in respect of children born before it was introduced. He said that he would have acted on the letters sent by HMRC had he received them. He gave evidence that his wife had been pregnant with their third child and the pregnancy had been difficult, and that life had 'got in the way'.

The FTT found that it was more likely than not that he had received at least some of the letters from HMRC, and that he would in any case have been aware that they had been issued because two debt collection agencies were regularly contacting him. His wife's pregnancy could potentially amount to a reasonable excuse; however, after the baby was delivered safely in August 2021, a further five months elapsed before he appealed to HMRC.

The FTT noted that for an excuse to be objectively reasonable, it must be one that could cause anyone in a similar position to fail to bring an appeal. The only explanation pertaining to the time between the birth and the eventual appeal was that 'life got in the way'. Observing that many fathers have caring responsibilities alongside their work commitments, the FTT did not consider either to be an objectively reasonable excuse. The man's application was dismissed.