In Whitehill Pelham Ltd v HMRC [2017] TC06188 HMRC were barred from the proceedings for a complete failure to engage with the tax tribunal; as a result the taxpayers penalty appeal was allowed.

It is not uncommon for HMRC to issue its statement of case late, or to be slow in providing other information for upcoming hearings: in this case, they failed to get involved at all.

Whitehall Pelham Ltd appealed to the first tier tax tribunal against a £500 penalty for late submission of an Employment Intermediary Return

  • They claimed Reasonable Excuse: their advisors had repeatedly tried to file the return but couldn’t because the HMRC website was down. 
  • HMRC failed to provide a statement of case and did not respond to any communication from the tribunal prior to the hearing.
  • The judge wrote to HMRC barring them from the hearing.

The judge determined that the appeal should be allowed because:

  • HMRC had not even indicated that they wished to defend the appeal, let alone provided grounds of defence against the appeal.
  • In any event, in the absence of any defence, the appellant had a reasonable excuse for the default.


It might be surprising to taxpayers that in such circumstances the only solution for the appellant was to appeal to the tribunal, especially given the amounts involved. The taxpayer may have a case for wasted costs.


Appeal: grounds for appeal

Grounds for appeal: reasonable excuse

Agency workers: employment intermediaries rules 

Whitehill Pelham Ltd v HMRC [2017] TC06188 


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