The taxpayer’s appeal against penalties for the late filing of a tax return was allowed as HMRC’s filing notice was not issued for the purpose of establishing the amount of his chargeability to tax, but to collect a tax underpayment.

On 23 March 2017, HM Revenue and Customs (HMRC) issued the appellant with a notice to file a self-assessment return for the tax year 2015/16. The notice required the appellant to deliver the return by 23 June 2017. A completed paper return was filed by the taxpayer on 8 May 2018.

HMRC assessed an initial penalty of £100, daily penalties amounting to £900, and a further penalty of £300 for failing to file the return six months after the due date. The taxpayer appealed (HMRC did not put a case to the First-tier Tribunal (FTT) for the daily penalties, so the FTT cancelled them).

The FTT