Personal Tax

Self assessment ― reasonable excuse for late filing

Produced by Tolley
  • 22 Mar 2022 09:48

The following Personal Tax guidance note Produced by Tolley provides comprehensive and up to date tax information covering:

  • Self assessment ― reasonable excuse for late filing
  • Burden of proof in reasonable excuse cases
  • Late filing of the self assessment tax return
  • What is not a reasonable excuse?
  • What might be a reasonable excuse?
  • When does a reasonable excuse end?
  • Case law
  • How to appeal a self assessment late filing penalty
  • Late filing penalties for 2020/21 tax returns ― bulk appeals

Self assessment ― reasonable excuse for late filing

If a penalty has been correctly charged by HMRC, the taxpayer can only appeal if they believe they have a ‘reasonable excuse’ for failing to comply with the legislation. This is discussed below. However, even if the Tribunal finds that the taxpayer does not have a reasonable excuse, it may reduce the amount of the penalty payable due to special circumstances. See Simon’s Taxes A4.567D.

The term ‘reasonable excuse’ is not defined in the legislation and therefore the meaning is continually being reassessed by the courts ‘in light of all the circumstances of the particular case’.

HMRC considers a reasonable excuse to be ‘something that stops a person from meeting a tax obligation despite them having taken reasonable care to meet that obligation’. In order to assess whether the excuse is reasonable, HMRC assesses ‘the experience, knowledge and other attributes of the person who has failed’ when deciding whether the taxpayer has taken reasonable care to meet the obligation.

Therefore, a reasonable excuse often arises where there is an unexpected or unusual event (or a combination of such events) that is either unforeseeable or beyond the taxpayer’s control.

Often if the taxpayer could reasonably have foreseen the event, whether or not it is within their control, HMRC will expect the person to take steps to meet their obligations.

This guidance note considers the concept of reasonable excuse. For commentary on how to build a case for reasonable excuse, see the Winning reasonable excuse cases guidance

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