The taxpayer received a form P35 from HMRC on 5 January 2009. The taxpayer was required to return the P35 together with form P14 which was not sent out but had to be obtained from HMRC. The notice also clearly indicated that if guidance was needed to telephone the Employer Helpline.

Form P35 was returned in time but without a form P14 and an appropriate box was also left unticked. HMRC returned the P35 asking the taxpayer to complete the appropriate box and to also return the P14 together with the corrected the P35.

HMRC issued a £100 penalty for the period to 19 June 2009 and a further £100 penalty for the period to 25 June 2009 when the forms were correctly filed. The taxpayer appealed these penalties contending HMRC should have sent him a P14 and it was unreasonable of them to complain of his tardiness when HMRC had taken 17 days to return his form for correction.

The appeal was dismissed by the First-tier Tribunal on the basis that based on the facts the taxpayer did not have reasonable excuse. He had been in business for some time and was aware of his obligations to complete the forms. The taxpayer was on notice (because of previous defaults) that if he failed to complete the returns he would receive a penalty. If he was in any doubt he could have instructed an accountant to assist him. Also there was no obligation on HMRC to respond quickly in any event as they were entitled to assume the forms were correct.

The full text of the judgment is available at http://www.bailii.org/uk/cases/UKFTT/TC/2010/TC00609.html