Presence of special circumstances

The taxpayer a builder appealed against penalties for the late filing of his self-assessment tax returns for 2011-12 and 2012-13. He said he had no knowledge of bookkeeping or business administration. His partner’s mother Mrs V kept his records for him. However Mrs V’s mother died in 2012 and her husband’s health deteriorated from 2009 making him violent and unreasonable.

HMRC said these did not constitute a reasonable excuse or special circumstances.

The First-tier Tribunal said that even though Mrs V admitted ‘it is entirely my fault that [the taxpayer’s] books were as late as mine’ FA 2009 Sch 55 para 23(2)(b) specifically states that reliance on a third person is not a reasonable excuse unless the taxpayer takes care to avoid the failure. The judge said it was clear that he was ‘experiencing very difficult circumstances’ but he had not...