Not special enough

The taxpayer company was late in making payments of PAYE and National Insurance liabilities during 2008/09 because of the economic downturn.

HMRC imposed fines against which the company appealed claiming it was unaware of the new penalty regime and that special circumstances existed under FA 2009 Sch 56 para 9(1) and (6).

The First-tier Tribunal accepted that trading conditions were difficult but said they were the result of normal trading in adverse economic conditions.

The company had not exercised reasonable foresight nor did it have proper regard for the date on which PAYE was due. The Revenue had not acted unreasonably.

The tribunal then considered if the department had failed to exercise discretion under Sch 56 para 9 which required the taxman to consider whether there were special circumstances as to why a penalty should be reduced.

The tribunal believed the fine was flawed because HMRC...