The First-tier Tribunal has considered, in separate cases, the validity of penalties. In Hills Residential, an automatic late filing penalty was invalid where the taxpayer had taken all reasonable steps to try to file the return on time; in Onillon the FTT considered for the first time the ‘reasonable in all the circumstances’ defence against a penalty for failure to take corrective action; HMRC v Tooth highlights the benefit of making full disclosure to HMRC, even where the legal technical basis for the claim by the taxpayer is controversial, and is later proved to be wrong; and D J Wood v HMRC confirms that a penalty for late filing cannot generally be invoked without a prior notice to file having been served.
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