No reasonable excuse for late returns but there were special circumstances

The taxpayer failed to submit his self assessment tax returns for the years 2013-14 2014-15 and 2015-16 so HMRC imposed penalties. The taxpayer engaged an accountant to help to bring his affairs up to date. The accountant filed the outstanding returns and lodged late appeals against the penalties.

The First-tier Tribunal decided to hear the appeals even though the delay was ‘significant’ – four years in one case. The judges found the taxpayer had no good reason for such delay but concluded there would be ‘no significant prejudice to HMRC’ to proceed.

On the substance of the appeal the tribunal decided the taxpayer did not have a reasonable excuse for filing his returns late. It was clear the taxpayer had a lot on his mind in 2014-15 because of financial problems and family illness but there was no evidence this continued beyond that year and in any...