Worcester Spice Ltd v The Commissioners for HMRC

Facts

Worcester Spice Ltd has been registered for VAT with effect from 1 October 2020 and submits returns quarterly. HMRC issued a VAT default surcharge on 14 October 2022 in the sum of £855.64 in respect of the period 8/22. The surcharge was the culmination of a series of defaults: payment for the period 5/21 was received late on 12/7/21, generating a surcharge liability notice on 16/7/21 but no penalty as it was the first default; payment for 8/21 was received late on 13/10/21, attracting a further notice on 20/10/21 but no financial penalty because the 2% surcharge fell below £400; and payment for 5/22 was received late on 13/7/22, with a notice issued on 17/7/22 and again no penalty charged for the same reason. The payment for 8/22 was made in two instalments received on 10/10/22 and 17/10/22, by which point the rate had reached 10% and the sum exceeded £400. The company's current director, who was not a director when the earlier defaults arose, appealed. Following a review conclusion letter of 9 January 2025, a notice of appeal was submitted on 20 January 2025 complaining of HMRC's failure to respond to communications, errors on the VAT statement and a failure to consider reasonable excuse. The appeal was determined on the papers.