Denise Howarth, a self-assessment taxpayer with a beforehand spotless report, has efficiently overturned £1,770 in fines and curiosity after a tribunal discovered that HMRC’s penalty emails had ended up in her junk folder—then vanished.
The First Tier Tribunal (FTT) accepted Howarth’s clarification that she was unaware of the fines till debt collectors contacted her, regardless of HMRC’s system registering the messages as “delivered.”
In a transfer prone to immediate additional scrutiny of HMRC’s digital notification course of, the FTT dominated that the penalties weren’t validly communicated and that Howarth had an affordable excuse for lacking the submitting deadline for her 2020–21 tax return.
The case additionally noticed the tribunal aspect with Howarth over a separate £100 wonderful issued for the earlier tax 12 months.
Whereas HMRC’s information claimed her 2019–20 return was submitted someday late, the FTT discovered that the return had the truth is been filed on time, undercutting the reliability of the division’s automated timestamp system.
Howarth, who has been within the self-assessment system since 2004 and submitting on-line since 2013, had by no means beforehand missed a deadline. Her enchantment to the tribunal was itself filed late, however the judges allowed it to proceed, citing the circumstances and her robust compliance historical past.
Of their judgment, the tribunal was clear: the digital supply of a message to an electronic mail account shouldn’t be the identical as efficient communication—significantly when the message by no means reaches the taxpayer’s consideration.
This nuance in digital correspondence may have broader implications for a way HMRC handles on-line communications, particularly because it continues to pivot away from paper.
The ruling gives a reminder to taxpayers to recurrently test their junk folders, and maybe extra importantly, to maintain information of despatched returns and correspondence.
For HMRC, it’s a wake-up name on the boundaries of automated programs and the necessity for human evaluation in enforcement processes.
