In Parwinder Gill v HMRC [2025] TC09602, the First Tier Tribunal (FTT) allowed an application to reinstate an appeal previously struck out due to the taxpayer's failure to comply with directions. The taxpayer had a reasonable excuse, as his adviser did not inform him of his responsibilities.
On 25 August 2022, HMRC issued Mr Gill with a Personal Liability Notice (PLN) for over £1.8 million due to deliberate VAT return inaccuracies by his company PS Gill Construction Ltd (PSGCL), for which Mr Gill was deemed responsible as an officer of the company.
- Mr Gill Appealed the decision in December 2022 on the grounds that he had not acted deliberately.
- The First Tier Tribunal (FTT) made multiple attempts to contact Mr Gill's adviser between March 2023 and January 2024, but they failed to respond.
- Following the tribunal rules, neither HMRC nor the FTT attempted to contact Mr Gill directly.
- The FTT issued an 'Unless Order' on 22 November 2023, requiring Mr Gill to comply with the direction to provide witness evidence by 6 December 2023.
- Mr Gill's adviser did not send copies of the directions or the Unless Order to him.
- No response to the Unless Order was received, and the appeal was automatically struck out on 7 December 2023.
- Mr Gill was unaware of these developments until February 2024, when HMRC wrote to Mr Gill to request the payment of the PLN.
- Mr Gill was shocked to receive this, as he had not received any correspondence from his adviser, and tried to contact his adviser numerous times before contacting HMRC directly.
- Mr Gill had assumed that there was a delay in arranging the hearing due to post-Covid backlogs.
- Mr Gill suffered from multiple serious health issues, including end-stage renal failure, heart failure, diabetes and depression. He was hospitalised in October 2023 and began dialysis treatment.
- During this time, his wife was also seriously injured in a car accident.
- These events occurred during the critical period when the FTT directions were issued and the Unless Order was in effect.
- On 13 February 2024, Mr Gill's adviser applied for reinstatement of the appeal, citing Mr Gill's medical conditions, but provided no explanation for their own failure to inform Mr Gill of his responsibilities.
- On 28 March 2024, the FTT issued a direction to provide witness statements for the hearing. HMRC provided witness statements in compliance with the direction. No evidence was filed on behalf of Mr Gill.
- Due to Mr Gill's poor physical and mental health, supported by letters from his GP, the first two hearings were postponed.
- Mr Gill was not present at the eventual hearing due to his health.
The FTT found that:
- The delay was serious and significant. Mr Gill failed to comply with directions for nearly three months, which affected the progress of the case and the ability to schedule a hearing.
- The reason for Mr Gill's failure to comply was due to his Reliance on his adviser.
- A person's reliance on their adviser should not normally provide a good reason for delay, and a reasonable taxpayer would check with their adviser.
- Given Mr Gill's serious health conditions and personal crisis during the relevant period, he could not reasonably have been expected to monitor his adviser to make sure the appeal was progressing.
- Mr Gill would have been focused entirely on his life-threatening medical conditions and his wife’s health following the car accident. The failings of the adviser should not have been laid at Mr Gill's door.
- The FTT concluded that this case was distinguishable from preceding cases where reliance on advisers was not accepted as a valid excuse.
The application to reinstate the appeal was granted.
Useful guides on this topic
Personal Liability Notices (PLNs)
A Personal Liability Notice (PLN) may be issued by HMRC in the event of a company's or a Limited Liability Partnership's (LLP's) failure to pay its tax debts or tax penalties to HMRC. A PLN will transfer all or part of the liability to pay the debt to one of its officers.
Grounds for Appeal: Reliance on an adviser or third party
When can a taxpayer appeal a penalty for late filing, late payment or for error or mistake? What are the grounds on which they can appeal?
How to appeal an HMRC decision
Disagree with an HMRC decision? How do you 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?
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