In Michael Anderson v HMRC [2021] TC8290, the First Tier Tribunal (FTT) allowed the taxpayer's appeal against failure to notify penalties. The taxpayer was not aware his partner was receiving child benefit and the FTT judged that this was a reasonable excuse.

The FTT agreed that the taxpayer did have a reasonable excuse as:

  • There is a principle of separate taxation of individuals who are partners.
  • There is no requirement for a person to be aware of their partner’s financial affairs.
  • The taxpayer paid tax under PAYE and there was no way that he would be able to identify a need to file a Self Assessment tax return for the relevant years.
  • The taxpayer had not received letters sent by HMRC which would have made him aware of the liability until January 2019.
  • The taxpayer settled the liability in February 2019 so the failure to notify was remedied without unreasonable delay.

Useful guides on this topic

High-Income Child Benefit Tax Charge
What is the High-Income Child Benefit Charge? Who pays it? Can you appeal against an assessment? Are there any useful cases from the tax tribunals? 

Penalties: Failure to notify
What tax penalties apply if you fail to notify HMRC that you are chargeable to tax? Can they be appealed or reduced?

How to appeal an HMRC decision
Disagree with an HMRC decision? How to appeal, what type of decision can you appeal and what are your different options when you disagree with HMRC? What are the key steps in making an appeal?

Grounds for Appeal: Reasonable excuse
What is considered to be a 'reasonable excuse' when a taxpayer makes an appeal against a tax compliance failure?

External links

Michael Anderson v HMRC [2021] TC8290



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