Commentary

A4.568A Reasonable excuse—reliance on HMRC

Administration and compliance

A4.568A Reasonable excuse—reliance on HMRC

A4.568A Reasonable excuse—reliance on HMRC

In certain circumstances, it may be that a taxpayer relies on HMRC guidance when dealing with their tax affairs and this may lead to a reasonable excuse claim in the event that a penalty arises.

HMRC guidance

In instances other than inaccuracies, for example in relation to late filing, HMRC says that it accepts that the taxpayer may have a reasonable excuse if, after receiving a notice requiring filing, they promptly contact HMRC to question whether they are required to file a return and it takes an unreasonably long time to reply. However, the taxpayer would be expected to file the return as soon as they receive HMRC's answer1.

The same principles would, presumably, apply to other situations where the taxpayer could not reasonably be expected to comply with an obligation before receiving a vital piece of information from HMRC.

Case law on relying on HMRC

The First-tier Tribunal and its predecessors have accepted that reliance upon misleading advice from HMRC can amount to a reasonable excuse.

Advice from an HMRC call centre that the taxpayer was allowed to make an electronic payment on the day of the deadline was held in Dental IT Ltd2 to excuse the fact that the payment took several days to clear and thereby arrived late. This was so notwithstanding the fact that material on HMRC's website advised taxpayers to take account of

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