In Ian Coll v HMRC [2019] TC 6971 the first tier tribunal (FTT) held that a taxpayer had a reasonable excuse for late filing because of failures by previously reliable accountants.

  • The taxpayer had income from a restaurant and an investment property.
  • For two years he used an accounting firm who submitted his tax returns properly.
  • In December 2012 or January 2013, the taxpayer had a meeting with the accountants who said there were problems with its own bookkeeping systems: they could not file by the deadline of 31 January 2013.
  • The firm did not use double entry bookkeeping.
  • In February 2013, the taxpayer appointed a new accountant.
  • The taxpayer informed HMRC of his problems early in February. He followed this with further calls updating HMRC of progress.
  • The old accountants refused to transfer the files to the new accountant which took several months to resolve.
  • The new accountant took a month to sort out the accountant. She filed the tax return on 31 July 2013.

HMRC imposed Late Filing Penalties, maintaining that reliance on another person in these circumstaces does not amount to a Reasonable Excuse for the compliance failure.

The tribunal found that the taxpayer had reasonable excuse:

  • He engaged professional accountants who had properly done his tax returns before.
  • When he learned near the deadline of the problems, he took prompt action to resolve them, and notified HMRC.
  • The new accountant prepared the accounts and filed the return promptly.


This case was first heard 'on the papers' and then there was an administrative problem with case references and it was deemed unfair for the taxpayer who could not follow what was happening. The first decision was set aside. Attending a hearing in personis generally the preferred option if you wish to defend an allegation of carelessness. Not easy for unrepresented taxpayers.

Useful guides on this topic

How to Appeal a Tax Penalty

Penalties: Late filing

Grounds for Appeal: Toolkit

Appeal: grounds for appeal

Grounds for appeal: reasonable excuse

External links

Ian Coll v HMRC [2019] TC 6971