Sci-Temps Ltd v HMRC

In Sci-Temps Ltd v HMRC [2020] UKFTT 314 (TC) (31 July 2020) the First-tier Tribunal found that HMRC’s determination of underpaid tax under reg 80 of the PAYE Regulations was invalid having been issued under the wrong procedure. The company had not failed to comply with its PAYE obligations and had not failed to take reasonable care.

In 2015/16 an employee (A) joined the company. On 8 April 2016 HMRC changed her tax code and the company implemented that change. In September 2016 HMRC changed the code again. The notification to the company included details of ‘previous pay’ of £3 144. The company’s payroll officer did not include that amount in the current year deductions working sheet. They considered that figure represented A’s pay to date in her employment with the company during the tax year and had not expected the coding notice to...

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