Again and again, we are seeing the Tax Tribunal (First-Tier Tribunal, Tax Chamber, is its formal and posh title) taking a strict line in what the Revenue has to prove before a penalty imposed on a taxpayer will be upheld on appeal (see http://www.breakinglaw.co.uk/search/label/tax%20penalties ).
And it has happened yet again as we see in the Tribunal's decision in Pidgeon v HM Revenue & Customs [2017] UKFTT 0438 (TC). Here, the taxpayer was appealing against penalties amounting to £1,500 for putting in a late return. He did put in a return in November or December 2012. But the Revenue maintained it was unsatisfactory and sent it back to him. A second return was submitted in January 2014 which the Revenue said was satisfactory. The penalties related to the period which elapsed between the Revenue's receipt of the two returns.
The Revenue cannot chuck back a return at a whim. To justifiably reject, the omissions from it must be so serious as to mean that in reality the document does not amount to a return at all. If you signed and dated the return form but failed to complete any other detail then, in my book, you could not seriously argue that you had sent set in your tax return. If you could there would be a lot of happier folk around. Whether the document amounted in reality to a return, held the Tribunal, was a matter of fact and degree.
So what was wrong with the taxpayer's first return which had started off the penalties? It was for the Revenue to say but it had failed to do so. What is more, it had failed to produce a copy of the document to the Tribunal. The mere fact that the Revenue had rejected it was not sufficient for the Tribunal to conclude that it was not up to the job.
The penalties in issue were quashed.
