The taxpayer was in a partnership with two partners on which HMRC imposed a £200 penalty for late filing of the partnership return for the year ended 31 January 2008. The paper return for the partnership was filed on 13 January 2009, after the 31 October 2008 deadline.

The taxpayer's agent understood that the information provided on HMRC's website, regarding penalties on the late filing of paper returns, was about partnerships. They contended that the same advice was provided by HMRC's helpline and claimed reasonable excuse. HMRC's view was that reasonable excuse could only be an exceptional event beyond the taxpayer's control. They also put forward that reliance by the agent on HMRC's guidance was not an excuse because ignorance of the law was no defence.

The Tribunal found that the agent was not relying on his ignorance of the law but on HMRC's misleading guidance on the law. HMRC had a duty to ensure that they did not mislead taxpayers into mistaken actions which incurred a penalty. Thus the taxpayer had a reasonable excuse for failing to file on time and that excuse existed throughout the period of default.

The full text of the judgment is available at http://www.bailii.org/uk/cases/UKFTT/TC/2010/TC00390.html