Salami slicing

June 8, 2012

I am fascinated this week by a tax case.  CIR v J Bentley, a first tier Tribunal case (TC 01927, which can be downloaded from this page)

The Tax Tribunal is how disputes between HMRC and taxpayers are settled if no agreement can be reached, and the First Tier is the equivalent of the Magistrates’ Court, dealing with what you might call low level disputes.

Mr Bentley was a pensioner who decided to fill in his own tax return to save money.  He’d had an accountant do it previously but thought he could do it himself with help from HMRC staff.  He turned up at his local HMRC office on 31 January, the day of the deadline, but HMRC wouldn’t deal with him then and there and offered him an appointment on 3rd February.  He went on 3rd February and filled in his return then, and was charged a penalty for the return being three days late.  He appealed on the grounds he had a reasonable excuse.

The HMRC argument is interesting:

… a prudent taxpayer would have appreciated that such appointments, especially on the filing deadline of 31 January, would be pre-booked and therefore unobtainable at short notice on one of HMRC’s busiest days. The Appellant should have acted sooner and made the necessary arrangements at an earlier date.

But there was nothing in the HMRC publicity to say “you need to allow [x amount of time] before the deadline if you want us to help you”.  An insider might know that HMRC customer service is, shall we say, a bit patchy, but would Joe Public?

…it does not appear to be in dispute that he did, prior to the deadline, seek to make an appointment, and that he did take the first available appointment which was on 3 February 2011, and that he did file the return on that date. The Tribunal is satisfied on the evidence that he would have accepted an appointment and have filed the return by 31 January 2011 if an appointment had been available on or before that date. The return was thus 3 days late, due not to his own conduct but due to HMRC’s unavailability.

The tribunal said that Mr Bentley DID have a reasonable excuse – he’d turned up before the deadline, and the fact that HMRC couldn’t cope with the demand was their problem, not his.

It sounds like a reasonable conclusion to draw.  But what does it mean for the Department?

There have been enormous staff reductions at HMRC in recent years, and the much vaunted £900m “increase” in compliance spend is actually only a £900m reduction in the amount by which HMRC’s budget was to have been cut and a redeployment of staff to compliance work from other tasks.

Other tasks like, say, the routine policy work of preparing 22 consultation documents in May?

Other tasks like dealing with people trying to make their returns on time.

I imagine, following the Bentley case, that HMRC centres will soon have large notices in them saying something like “please allow 10 days before we can give you an appointment, and more at busy times”. (Whenever I see something like that it always feels like the organisation is giving up and saying “we’re crap and we know we are.”)

There must come a point when salami slicing at the resources put into collecting tax leaves you without enough people to do the job.

Are we nearly there yet?


  1. U get to v cool things

  2. […] when I was looking for the entry, I also noticed the entry from 8th June regarding the Bentley case and my prediction that Enquiry Centres would soon have to have notices […]

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