Permission to Bring Late Appeal Against Closure Notices Refused

The Upper Tribunal (UT) has upheld a decision refusing a taxpayer permission to bring a late appeal against closure notices issued by HM Revenue and Customs (HMRC).

After HMRC issued closure notices determining an increase in the taxpayer's Income Tax liability for two tax years, he appealed to the First-tier Tribunal (FTT). The notice of appeal was filed more than four months late. Seeking permission to bring a late appeal, he stated that he had suffered a career-ending injury that had affected his mental health and he had gone to Australia to recuperate with his family. His mental health issues meant that his capacity to deal with his tax affairs was limited. His accountant had been ill and unable to work for a lengthy period, and had not contacted him on his return to work because he had been under considerable pressure and the taxpayer had been absent from the UK.

The FTT found that his accountant being unable to work would have constituted good grounds for the delay but for the fact that his absence had only started when the appeal was already two months late. There was no evidence presented to substantiate the state of the taxpayer's health, and there was evidence that he had been able to deal with his accountant. The FTT decided that his absence in Australia was not a barrier to communication with his accountant. The FTT also noted that taxpayers cannot delegate their entire responsibility for the conduct of their tax affairs and have some responsibility to ensure that their accountant deals with their affairs on a timely basis. Evaluating all the circumstances, the FTT held that he had not established a good reason for the delay and it was not appropriate to give permission for a late appeal.

The taxpayer appealed to the UT, arguing that the FTT had failed to conduct a holistic assessment of 'good reasons' for the delay and had given insufficient weight to the prejudice he would suffer if permission were refused. However, the UT observed that while he clearly disagreed with the weight placed by the FTT on the evidence before it, he was unable to point to the FTT considering irrelevant factors or ignoring relevant factors in reaching its decision. The FTT had expressly stated that the prejudice he would suffer weighed in support of allowing the late appeal. The FTT had set out its reasons for the weight it had given to the evidence and there was no basis for the UT to interfere with those findings.

He also contended that the FTT had not adequately scrutinised the underlying merits of his case and had given inadequate reasons for its decision. The FTT had stated that, while HMRC had not convinced it that his appeal was 'doomed to fail', nor had he convinced it that his case was very strong. For those reasons, the FTT had not considered that the likely merits of the underlying appeal weighed strongly in either direction. The UT found that there was no realistic prospect of this ground of appeal succeeding. The UT was also satisfied that the FTT had set out the reasons for its decision in adequate detail. Permission to appeal was refused.