Significant ‘reasonable excuse’ decision

Les Howard
VAT Consultant
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The case of D R Sudall was decision without a Hearing, a so-called ‘paper case.’ It is just one in the series of Donaldson cases, which deals with the issue of daily penalties for failure to submit a tax Return; so, not a VAT case. But, it does address the question of a reasonable excuse defence, which applies to VAT and many other taxes.

The significant point (in para 22) is that, where any Return is submitted late, a reasonable excuse defence can only be effective where there is a reasonable excuse for the initial failure to submit.

The converse is where the taxpayer does not have a reasonable excuse at the date the Return was required to be submitted. Subsequent events cannot provide a reasonable excuse for additional penalties.

I am not convinced that other Judges will follow this, but it will be interesting to see how this line of decision develops.

The decision is here:

About Les Howard


Hi, I am a VAT Consultant, working mainly with charities. I am based in Cambridgeshire

I have over 20 years experience in VAT, and am currently also a part-time member of the Tax Tribunals.


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