Knowles Warwick Ltd (TC3362)
The taxpayer was a company of chartered accountants that appealed against penalties imposed under FA 2009 schedule 56 for making late payments of PAYE during 2011/12.
The firm claimed special circumstances saying it had helped clients through the difficult economic period since 2008 sometimes on a non-commercial basis.
It was under financial pressure on one occasion barely having enough cash to pay its staff. The loss of two major clients meant business had shrunk by 20%.
The company also had to deal with employee illness and fee-earners leaving – although business had become more viable by spring 2012 and had since doubled in size.
The taxpayer had amassed a PAYE debt of £44 000 for 2010/11 and wanted to repay it in the first four months of 2011.
There was a lot of contact between the firm and HMRC during the period from April 2009...
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