What is reasonable excuse?
A person will not be liable to a penalty if there is reasonable excuse for what they have or have not done. There is no definition of reasonable excuse and what is reasonable may vary from person to person and depend on the particular circumstances of a case. It will usually be an exceptional or unforeseen event that is beyond the person's control.
If a person claims they have reasonable excuse then you must consider this carefully, based upon their explanation and other evidence as appropriate. They will have to tell you the reason and you should listen to their claim carefully.
You may decide that in order to test their claim you require further material. You may wish to use the information powers to obtain this in which case you must make sure that any request for this evidence is reasonable and proportionate and within the Human Rights legislation.
If the case has been designated as sensitive, for example, if it concerns a vulnerable taxpayer, you should take this into consideration and you must get the approval of an authorised officer for any proposed actions.
Some examples of what you might consider to be reasonable excuse include:
- documents being lost through theft, fire or flood
- serious illness
- bereavement
- computer or electrical faults.
When a document is in a person's power but not in their possession then unavoidable delay in obtaining the document from the possessor will normally be considered reasonable excuse.
However, the person will have to show that there was no delay in asking for the document from the possessor and the reason why the possessor was unable to supply the document within the time specified in the notice.