In Steven Singh v HMRC [2014] TC 03436, the FTT considered whether Mr Singh had a reasonable excuse for failing to provide information under an Information Notice and upheld certain penalties for his failure to do so.
Under a Sch 36 Information Notice HMRC may:
- make a written request (“an information notice”) for a taxpayer to provide information or a document,
- if the information or document is reasonably required by the officer for the purpose of checking the taxpayer’s tax position.
The notice required Mr Singh to produce bank statements, but he provided them with the addresses of certain people redacted because they did not want him to disclose this information. As a result - in an amended information notice, the FTT required him to produce unredacted bank statements but he failed to do so.
Mr Singh claimed that:
- The statements were already redacted when he got them and it was not possible to go to the relevant individuals to obtain unredacted copies, and
- He claimed that to do so would be breach of confidence, “as a matter of honour”.
- However, he accepted that he knew some of the addresses.
The FTT held that:
- it had a reasonable excuse because he had never had unredacted statements and that he could not now get them.
- his refusal to provide the statements on the grounds of confidentiality was not a reasonable excuse and this had been made clear to him at the original hearing.
Penalties
As Mr Singh had failed to comply with the information notices, HMRC applied:
- a £300 penalty (paragraph 39 of Sch 36)
- daily penalties of £50 a day (paragraph 40, Sch 36), and
- further daily penalties of £60 a day.
Total penalties amounted to £3,700.
HMRC confirmed at the hearing that it did not intend to charge any more.
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