Beta This part of GOV.UK is being rebuilt – find out what this means

HMRC internal manual

Compliance Handbook

From
HM Revenue & Customs
Updated
, see all updates

Dishonest tax agents: file access notice: reasonable excuse: overview

A person won’t be liable to a penalty for failing to comply with a file access notice, see CH183320, if

  • they satisfy us that they have a reasonable excuse, see CH183540, for the failure, and
  • they put right the failure without unreasonable delay after the excuse has ended, see CH183660.

The onus is on the person who failed to comply with the file access notice to establish a reasonable excuse.

There is no statutory definition of reasonable excuse, which is a matter to be considered in the light of all the circumstances of the particular case. See the more detailed explanation at CH183540.

What is reasonable will differ from person to person depending upon their particular circumstances and abilities. However, there are some excuses that are not normally accepted as reasonable. These are

  • shortage of funds, but see the exception in CH183620, and
  • reliance on another person, but see the exception in CH183640.

If the reasonable excuse for the failure ends, we will treat the excuse as continuing if the person

  • puts right the failure, and
  • does so without unreasonable delay after the excuse ends.

If the person does not put right the failure without unreasonable delay after the excuse has ended they remain liable to a penalty.

What is unreasonable delay depends upon the facts and circumstances of each case, see CH183660. If the person does delay unreasonably then, whatever the reason for the failure, they do not have a reasonable excuse.

If we decide not to accept the person’s excuse as reasonable, they can appeal. The person has the right to a review and may notify their appeal to the tribunal instead of, or after, a review. The Appeals, Reviews and Tribunals Guidance (ARTG) contains full details of the review and appeals process, see ARTG2100+.

If the person had a reasonable excuse for failing to comply with the file access notice and corrected that failure without unreasonable delay, then we don’t need to consider penalties for failing to comply with a file access notice.

Note that the reasonable excuse provisions do not apply to penalties for dishonest conduct.

FA12/SCH38/PARA25