TC09679 - [2025] UKFTT 01331 (TC)

There was no dispute about the legislation which is summarised below:

Under Section 8 Taxes Management Act 1970 (“TMA 1970”), a taxpayer, chargeable to income tax and capital gains tax for a year of assessment, who is required by an officer of the Board to submit a tax return, must submit that return to that officer by 31 October immediately following the year of assessment (if filed by paper) and 31 January immediately following the year of assessment (if filed on line).

Under section 12D TMA 1970, voluntary returns (i.e. returns which are not submitted in response to a notice to file) are treated as having been made in response to such a notice which was given to the person on the same date as the return was received by HMRC.

Failure to file the return on time engages the penalty regime in Schedule 55.

Penalties are calculated on the following basis:

In order to visit a penalty on a taxpayer pursuant to paragraph 4, HMRC must decide if such a penalty is due and notify the taxpayer, specifying the date from which the penalty is payable (paragraph 4).

If HMRC considers a taxpayer is liable to a penalty, it must assess the penalty and notify it to the taxpayer (paragraph 18).

A taxpayer can appeal against any decision of HMRC that a penalty is payable, and against any such decision as to the amount of the penalty (paragraph 20).

On an appeal, this tribunal can either affirm HMRC's decision or substitute for it another decision that HMRC had the power to make (paragraph 22).