Hearings
United Kingdom
07 Jan 2026 [2026] UKUT 7 (TCC), FTT
Cox v Revenue and Customs (PENALTIES - HMRC had refused to exercise its discretion to suspend penalties for careless inaccuracies)
AI Summary & Issues
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In the Upper Tribunal case [2026] UKUT 00007 (TCC), Philip and Debra Cox appealed against HMRC's refusal to suspend penalties for careless inaccuracies in their self-assessment returns. The First-tier Tribunal upheld HMRC's decision, noting the inaccuracies resulted from a one-off event and that no preventive conditions could be established. The Upper Tribunal dismissed the appeal, confirming HMRC's decision was sound, as the proposed conditions did not indicate measurable improvement in taxpayer behaviour. Consequently, the penalties of £16,152.90 and £16,252.35 were upheld.
Issues
- Did the First-tier Tribunal err in concluding that HMRC's refusal to suspend the penalties was justified despite the Appellants' claims of a one-off inaccuracy?
- Was there a sufficient link required by paragraph 14(3) between the inaccuracy leading to the penalty and any potential future inaccuracies, and did the FTT misinterpret this?
- Did HMRC unreasonably fetter its discretion by applying the SMART criteria in a way that excluded suspending penalties for one-off inaccuracies, and was this approach justified by the FTT?