Wrong agent

Determination to collect underpaid tax

The taxpayer underpaid PAYE tax and National Insurance for one of its employees because it had not received a notice of coding taking into account the employee’s company car.

HMRC said it had issued the code electronically to the taxpayer’s agent whom it believed was authorised to receive such communications. It issued a reg 80 determination on the employer to collect the underpayment. The taxpayer said neither it nor the agent had received the coding notice. Further neither was set up to receive electronic communications. On the basis that the employer had taken reasonable care to comply with the PAYE regulations and the underpayment was not its fault HMRC should reduce the reg 80 determination to zero and raise a reg 72(5) determination on the employee to pay the tax.

The First-tier Tribunal said under reg 196(1) if HMRC used an...