Human rights defence blow for taxpayers
Taxpayers planning to defend themselves against HMRC penalties by using the European Convention of Human Rights have been dealt a heavy blow after a ruling by the special commissioners
A small business, Auntie’s Café, was challenging two fixed penalties of
£1,000 each for filing its accounts late on the grounds that the penalties were
inconsistent with the Human Rights Convention.
But special commissioner Howard Nowlan said its rights had not been infringed
as the penalty regime was compatible with the EU legislation.
Nowlan ruled that the penalty regime was there to ensure compliance with the
tax system. As such compliance was in the public interest, the penalties were
proportionate to the offence.
‘This is a common sense judgment. The penalty regime is there to penalise
non-compliance and push out tax evaders and this supports that,’ said Kevin
Hindley, associate tax director at Chiltern.
A number of advisers have considered using unconventional defences, such as
human rights, to challenge HMRC penalties.