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Valid Grounds for Appeal

Valid Grounds for Appeal

I have recently taken on a new client who was in arrears with his Tax Returns. During his interview with me he produced two letters from the Revenue which were penalty determinations for 2004/2005 and 2005/2006. I subsequently submitted the outstanding tax returns with an appeal against the penalty determinations on the grounds that refunds were due for both tax years.

The Revenue have now written back to me "please note that I do not consider that the submission of the 2004/2005 & 2005/2006 Tax Returns are valid grounds for appealing against the 2004/2005 and 2005/2006 charges raised under section 93(3) TMA1970."

Can anyone suggest why my reasons were not valid and perhaps include reasons which would be valid in the eyes of the Revenue.

Your attention is appreciated.

Peter Chalk


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15th Oct 2008 16:41

Daily Penalties
The 'normal' £100 penalties are limited by the liability outstanding on the due date for the returns. Effectively this means that these penalties would exist but are capped at £nil.

Unfortunately the same cannot be said for daily penalties under S93(3). These are not capped by the outstanding liability and so mere submission of the returns would have no effect. What you need is a valid reason why the returns were late and for that reason to have existed throughout the period of default, Without such a reason the penalties will stand.

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