In Fab Cleaning Management v HMRC [2016] UKFTT 31 (21 January 2016) the FTT cancelled penalties imposed for inaccuracy in PAYE returns.
Fab traded as a contract cleaning company which was run by a husband and wife and a company secretary on a part time basis. Following a check into Fab’s employer’s end of year returns for the relevant year HMRC had concluded that Fab had deducted too little income tax and NICs from its employees’ earnings. HMRC had therefore issued formal determinations designed to recover the underpayments and imposed the disputed inaccuracy penalties (FA 2007 Sch 24 para 1). Fab contended that as an employer it had been required to submit a return setting out the amounts that had been deducted from its employees’ earnings not the amounts which ought to have been deducted (PAYE Regulations reg 73).
The FTT noted that Sch...
