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Congestion Charge

It is early so I'm only 90% confident of this.  I know that parking fines, speeding fines, yellow box junction fines etc are not claimable, but is there anything in the logic of the Congestion Charge that makes their fine for non-payment into something deductible?  It may be that the fines are in fact higher rates of payment of the Congestion Charge but on an unregistered basis.  After all, the original £10 is a fine for using Central London during working hours so is the fine any different?  Anyone got a straw to offer?

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05th Apr 2012 07:58

amended - sorry - please ignore

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Sharing their punishment with the rest of us.

I've seen an argument advanced for parking fines being allowable on the basis that they are not fines or penalties at all, but "civil liabilities".  I don't think the argument holds any water though.

National laws and local byelaws are set to cause us to behave in a certain way.  When people fail to behave in that way, they often face some form of punitive charge, by whatever name.

HMRC rely on the following passage from Lord Hoffman's speech in the House of Lord's decision in McKnight v Sheppard (see BIM37965) to disallow such punitive charges:

"I think with great respect that the Court of Appeal had difficulty in identifying exactly what this was because they were looking in the wrong place. They hoped to find the answer in the broad general principles of what counts as an allowable deduction. But the reason in my opinion is much more specific and relates to the particular character of a fine or penalty. Its purpose is to punish the taxpayer and a court may easily conclude that the legislative policy would be diluted if the taxpayer were allowed to share the burden with the rest of the community by a deduction for the purposes of tax. This, I think, is what Lord Sterndale M.R. meant when he said that the fine was imposed ‘upon the company personally'".

There views are further expressed in BIM38515 and BIM38520.  Personally, I'm not in disagreement with their views.

I have advanced a contrary argument in the case of a haulier company that suffered "trumped up" fines in mainland Europe on the basis that they were an unavoidable consequence of the business.  Being Self-Assessment though, the point was never argued as HMRC didn't take issue (either because they agreed, didn't want to argue the point, didn't care or just didn't notice the disclosure).

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