Officialdom can sometimes be faceless, but the law is always there to ensure that individual circumstances are taken into account. In an example of that happening, HM Revenue and Customs (HMRC) was severely criticised for its pursuit of a homeless man who failed to file a tax return on time.
The self-employed electrician had suffered several of unfortunate life events which culminated in him living rough on the streets. Amongst other things, all his savings had been exhausted after he lost his job and he had been thrown out of his rented home.
All of his belongings, including his tax records and other documents, had been lost or stolen following his eviction. HMRC’s correspondence had been sent to his former address, sohe did not receive it. However, after he failed to submit a tax return by a deadline date, HMRC issued four financial penalties, totalling £1,600.
After the man challenged the penalties before the First-tier Tribunal (FTT), HMRC’s lawyers argued that there was nothing special about his circumstances and that his homelessness was not out of the run of ordinary events.
In upholding the man’s appeal, however, the FTT condemned HMRC’s conduct of the matter as scandalous. To expect a homeless man to keep HMRC up to date on his address was ridiculous to the point of absurdity. Being homeless and having to live rough had to be something out of the ordinary and no reasonable HMRC officer could have decided otherwise.
It should have been obvious that the man might be suffering from mental health difficulties and his homelessness clearly amounted to a particular difficulty or misfortune that should have prompted HMRC to waive the penalties. Within three months of finding a new job and somewhere to live, the man had put his affairs in order and filed the tax return. In the circumstances, the penalties were overturned on the basis that he had a reasonable excuse for failing to meet the deadline.
