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Two taxpayers began trading in a partnership in December 2009. HMRC sent them a partnership return in April 2010, but the partners did not receive it. They did not file a partnership return for 2009/10 and, as a result, the taxman imposed a £100 penalty.
The taxpayers had filed correct individual self assessment returns for the year. They appealed against the penalty, saying they had a reasonable excuse: they had not realised they had to file a partnership return as well as their personal returns.
The First-tier Tribunal noted the partners had visited their local tax office and came away believing that they would comply with their obligation by completing the partnership pages of their personal tax returns.
The judge said, in her view, the taxpayers had acted responsibly throughout; as soon as they realised they should have completed a partnership return, they did so.
The partners’ appeal was allowed.
