A recent case at the Upper Tribunal considered this question with regard to late payment penalties charged on self-assessment tax returns (B Edwards v CRC, Upper Tribunal (Tax and Chancery Chamber).

The taxpayer incurred  penalties in relation to his 2010-11, 2012-13 and 2013-14 self-assessment tax returns of £3,880 despite there being no tax due.

The taxpayer had already been unsuccessful at the First-Tier Tribunal and so appealed to the Upper Tribunal on the grounds that the notices to file returns had not been issued correctly and with the argument that the penalties were disproportionate to the tax due.

The taxpayer’s appeal was dismissed again.  The Upper Tribunal found that there had been no error in law in the First-Tier Tribunal’s decision regarding the notices to file returns.

On the issue of proportionality, they found that in terms of the European Convention on Human Rights, the penalties were ‘harsh’ but not ‘plainly unfair’ and was therefore not a relevant ‘special circumstance’ which HMRC should have taken into account.

The moral of the story is therefore to file tax returns on time – even where there is no tax to pay!  It is a requirement to file a return where a notice to file has been issued.  Eaves and Co would be very happy to assist if you have a tax return that needs filing.

I am pleased and proud to be able to announce that David Stebbings who has worked with me for the last 11 years is taking over the senior role at Eaves and Co.  He will be running the business in future and no doubt it will progress from strength to strength in his capable hands.
I will remain in the background to act as consultant when required.  [He cannot get rid of me that easily!]  May I take this opportunity to thank all those clients and contacts who have supported us over the last 25 years.  I trust David can continue to count on it for the future.
So far as my career is concerned for the main part I am determined to make a living out of writing.  My first murder novel is out now in paperback and ebook for gadget (Kindle, table, smart phone) so please give it a read, if you have not already done so.
https://www.amazon.co.uk/Bankers-Draft-R-G-Lennon-ebook/dp/B07CW4JC1J
My second one should be out in the next few weeks, also under the pen name RG Lennon.  Anyone interested in pre-publication offers contact me on:
RGLennon@middleton-e-publishing.com
Best Wishes for the Future
Paul Eaves