Chuan Yi Xu v Revenue & Customs [2015] UKFTT 108 (TC)
FTT-Tax
Chuan Yi Xu v Revenue & Customs
[2015] UKFTT 108 (TC) · 2015-02-27
[12]Secondly, the Appellant refers to Maxwell v Revenue & Customs [2013] UKFTT 459 (TC) . In that case it was held that illness of an agent may be grounds for allowing a claim for special relief under Schedule 1AB (Section 3A) Taxes Management Act 1970 , where the appellant considered that the agent was competently managing his tax affairs.13. Thirdly, the Appellant refers to Murphy v Revenue & Customs [2014] UKFTT 734 (TC) . In that case it was held that the appellant’s failure to pay Class 2 National Insurance contributions was not due to his failure to exercise due care and diligence in circumstances where he was relying on the advice of a professional agent.14. Fourthly, the Appellant refers to Laithwaite v Revenue & Customs [2014] UKFTT 759 (TC) . In that case it was held that the appellant had a reasonable excuse for not submitting returns under the Construction Industry Scheme in circumstances where he had acted on his accountant’s advice.15. However, the Tribunal finds that these cases turned on their specific facts. The burden is on the Appellant to present to the Tribunal sufficient evidence to establish the existence of facts on which a ground of appeal is based, on a balance of probability. In order to rely on the cases referred to by the Appellant, it would be necessary for the Appellant to establish, on a balance of probability, for instance, that the Appellant was reasonably relying on her former agent to pay the amount of tax due by 31 January 2013. For instance, if the Appellant could demonstrate by evidence that within sufficient time she sent sufficient funds to her former agent with instructions to pay the tax to HMRC by the deadline, and that the former agent failed to do so due to an illness of which the Appellant was unaware, then the cases cited might be argued to be analogous. However, there is no evidence in this case that such circumstances existed. Such circumstances are not established on a balance of probability by speculative statements by the Appellant’s agent to the effect that “we are under the impression that the responsible party at [the Appellant’s former agent] may be suffering from medical problems which would [have] impacted their ability to ensure that payment was made on time on behalf of their client”. Indeed, this does not even amount to a positive statement that the Appellant was relying on the former agent to make the actual payment of the tax to HMRC.16. The Appellant also contends that there have been “oversights and carelessness” by HMRC in addressing correspondence to the Appellant’s agents or the Appellant. In support of this argument, the Appellant refers to South v Revenue & Customs [2014] UKFTT 807 (TC) . In that case it was held that the appellant had a reasonable excuse for failing to submit a tax return on time in circumstances where the Appellant did not receive the notice to file. The Tribunal found that the notice may not have been received by the Appellant because there was a slight inaccuracy in the postal address for the Appellant held by HMRC.17. The Tribunal considers that the relevance of this case has not been established. A tax return was submitted on behalf of the Appellant. The Appellant should have known the amount of her tax liability according to that tax return, and should have known that she was required to pay the amount of that tax liability by 31 January 2013. The Appellant has not explained how any misaddressed correspondence from HMRC could have prevented her from meeting that obligation. If the Appellant failed to receive a penalty notice, that might explain a failure to pay a penalty, but it would not in the present case explain a failure to pay tax on time. Furthermore, the Appellant should have been aware that she had failed to pay her tax, whether or not she received any penalty notices. Conclusion18. The Tribunal therefore finds that the Appellant has not established a reasonable excuse or the existence of special circumstances, and the appeal is dismissed .19. This document contains full findings of fact and reasons for the decision. Any party dissatisfied with this decision has a right to apply for permission to appeal against it pursuant to Rule 39 of the Tribunal Procedure (First-tier Tribunal) (Tax Chamber) Rules 2009. The application must be received by this Tribunal not later than 56 days after this decision is sent to that party. The parties are referred to “Guidance to accompany a Decision from the First-tier Tribunal (Tax Chamber)” which accompanies and forms part of this decision notice. DR CHRISTOPHER STAKER TRIBUNAL JUDGE RELEASE DATE: 27 February 2015