Human Rights Act marshalled to fight tax penalties

Human Rights Act marshalled to fight tax penalties

Tax advisers are planning to use the Human Rights Act to protect their clients from tax penalties

Reports this week indicated that chancellor Gordon Brown was certain to
toughen the government’s stance on the late filing of self-assessment returns
and penalties. It is expected that HMRC will hike the penalty for late returns
from £100 to £250 and issue harsher penalties on those who unwittingly pay too
little tax when the pre-Budget report is delivered this Autumn.

Advisers, however, are already responding to what they see as a harsher
penalty regime by using unconventional defences.

Mike Warburton, tax partner at
Grant Thornton,
said he was set to use the Human Rights Act to contest a penalty charged to one
of his clients.

Warburton said that after a ruling in the King vs Waldon case in
2001, a tax penalty under European law was found to be a criminal rather than a
civil case.

The upshot is that any taxpayers who are issued penalties are entitled to the
same protections and protocols as a person facing a criminal charge, as per the
Human Rights
Act.

This means that when charging a penalty,
HMRC is obliged to
follow specific procedures and inform tax payers that they should be careful not
to incriminate themselves. This would provide taxpayers with more opportunities
to challenge penalties.

Related Articles

Paul Morton, Tax Director, Office of Tax Simplification

Administration Paul Morton, Tax Director, Office of Tax Simplification

5m Emma Smith, Managing Editor
LITRG urges government to consider tax changes in disability work plan

Administration LITRG urges government to consider tax changes in disability work plan

6m Lucy Skoulding, Reporter
HMRC appeal rejected in Tottenham Hotspur case

Administration HMRC appeal rejected in Tottenham Hotspur case

7m Emma Smith, Managing Editor
HMRC issues updated Trusts Registration Service guidance

Administration HMRC issues updated Trusts Registration Service guidance

7m Emma Smith, Managing Editor
New trading allowance: simplicity, but not as we know it

Administration New trading allowance: simplicity, but not as we know it

8m Emma Rawson, ATT Technical Officer
‘Improve rather than lose’ disincorporation relief, tax body urges

Administration ‘Improve rather than lose’ disincorporation relief, tax body urges

9m Austin Clark, Reporter
Are you ready for the Trusts Registration Service?

Administration Are you ready for the Trusts Registration Service?

9m Helen Thornley, ATT Technical Officer
Advisers bullish despite Brexit concerns

Accounting Standards Advisers bullish despite Brexit concerns

2y Fraser Simpson, Reporter