In UBI Ltd v HMRC [2018] TC06771, the FTT agreed that a company with a poor compliance record was reasonably required to provide HMRC with security for PAYE liabilities. It failed to keep to a time to pay agreement. 

  • For tax years from 2013/14, the company failed to pay the full amount of PAYE it declared.
  • In September 2016, the company agreed a Time to Pay (TTP) arrangement with HMRC but failed to keep it.
  • In December 2016, HMRC warned the company that if it did not pay the PAYE due, it would require security.
  • The company did not pay nor agree a further TTP.

HMRC required the company to provide more than £110,000 in security for PAYE liabilities.

  • The company appealed and put forward three arguments against security:
    • it had a good track record of payment
    • it was working to clear the arrears
    • the security sought would cause it financial distress for a seasonal fashion business.

The company failed to attend the tribunal hearing, and three times refused to speak to the tribunal when a clerk telephoned.

On reviewing the papers, the tribunal dismissed the first two arguments as clearly untrue. The third argument was unsupported by any accounts or other evidence.


It is quite unusual for HMRC to require security from an existing business.

Useful guides

PAYE Real Time Information Reporting (RTI)
Essentials for employers

RTI late filng penalties
Penalties for failure to submit returns

PAYE late payment penalty buster
What to do if you can't pay, and how to avoid extra late payment penalties


Case report UBI Ltd v HMRC [2018] TC06771