Guides

What Is a Reasonable Excuse? (And Will HMRC Accept Yours?)

HMRC has penalised you for a late return or payment. You had a good reason. But is it good enough? Here's what actually counts as a reasonable excuse.

Liam Williams

24 Jan 2026 — 8 min read

HMRC has sent you a penalty notice. You missed a deadline—maybe a tax return, maybe a payment. But you had a reason. Life got in the way.

The question is: will HMRC accept that reason? And if they don't, will a tribunal?

If you're not sure what type of penalty you've received or how the amount was calculated, see our guide to HMRC penalties first. If your penalty is specifically for a late Self Assessment return or late payment, our SA penalties guide covers the specific calculation, common traps, and how to appeal. The same reasonable excuse test applies to the new points-based penalty regime for VAT and MTD for Income Tax—the tribunal has already confirmed this in multiple cases.

What "Reasonable Excuse" Means

A reasonable excuse is something that stopped you meeting a tax obligation that would be accepted by a reasonable person as a valid reason for the failure.

The law doesn't define exactly what counts. Instead, tribunals apply an objective test: would a reasonable taxpayer, in your circumstances, have done the same thing?

This isn't about whether you thought your actions were reasonable. It's about whether the tribunal thinks a hypothetical reasonable person would have acted as you did.

If you can show you had a reasonable excuse, you won't have to pay the penalty. But the excuse must cover the entire period of the failure—and once the excuse ends, you must act "without unreasonable delay" to fix the problem. In practice, tribunals have generally expected taxpayers to act within days to a few weeks of the excuse ending, not months.

What HMRC Says Counts

HMRC's official guidance lists these examples of reasonable excuses:

A close relative died shortly before the deadline
You had a serious or life-threatening illness
You were unexpectedly in hospital
Your computer or software failed while preparing your return
HMRC's online service was down
Fire, flood, or theft prevented you from completing your return
Postal delays you couldn't have predicted
A disability or mental health condition affected your ability to deal with your tax affairs

But HMRC also says these are not reasonable excuses:

You didn't have enough money to pay
You found the HMRC system difficult to use
You didn't get a reminder from HMRC
You made a mistake on your return

The Perrin Four-Step Test

HMRC's published list is guidance, not an exhaustive definition. When a penalty appeal reaches the tribunal, judges apply the framework set out in Perrin v HMRC [2018] UKUT 156 (TCC). For a deep dive into the judgment itself—including the powerful points most people miss—see our Perrin case analysis. The test has four steps:

Step 1: What facts do you say give rise to a reasonable excuse? Identify the specific circumstances you're relying on—illness, bereavement, system failure, reliance on an adviser, postal problems, or anything else. This can include your beliefs, actions, or omissions, as well as external events.

Step 2: Which of those facts are proven? You need to establish your facts on the balance of probabilities. This is where evidence matters—medical records, screenshots, correspondence, a clear timeline. If you claim you believed your return had been filed, the tribunal must first decide whether you actually held that belief.

Step 3: Viewed objectively, do those proven facts amount to a reasonable excuse? This is the central question. The Upper Tribunal in Perrin suggested the tribunal ask itself: was what the taxpayer did (or omitted to do or believed) objectively reasonable for this taxpayer in those circumstances?

The test is personalised. The tribunal considers your experience, knowledge, and situation—not just what an average person might do. A first-time taxpayer with no experience of the system is judged differently from a professional accountant.

Step 4: Once the excuse ended, did you act without unreasonable delay? Even a completely valid excuse is lost if you don't act promptly once the obstacle is removed. See Without Unreasonable Delay below.

The burden of proof is on you. HMRC must first show the penalty was validly imposed, but once that's established, you need to prove your reasonable excuse.

What The Tribunals Have Actually Decided

The following cases show how tribunals have applied these four steps in practice.

Cases Where Reasonable Excuse Was Accepted

Relying on your accountant — Barrett v HMRC [2015] UKFTT 329 (TC)

Mr Barrett was a jobbing builder who hired subcontractors. His accountant knew this but failed to tell him about his obligation to file monthly CIS returns. When HMRC issued penalties of over £129,000 (later reduced to around £4,000), Mr Barrett appealed.

The tribunal found he had a reasonable excuse. The judge found there was nothing in the evidence to suggest Mr Barrett should have questioned his accountant's competence or that he had acted unreasonably in his overall approach. Mr Barrett had provided information promptly, had no reason to doubt his accountant, and wasn't required to independently research CIS requirements. The tribunal also criticised HMRC's narrow interpretation of "reasonable excuse" as inappropriate.

HMRC's poor communication — Hill v HMRC [2020] UKFTT 316 (TC)

Mr Hill was liable for the High Income Child Benefit Charge (HICBC) but didn't know it. He'd never needed to file a tax return before—he was on PAYE with no other income. HMRC had the information to work out his liability but didn't contact him for years.

The tribunal found he had a reasonable excuse. Judge Manuell said: "The combination of inadequate information from official sources and the long delay in notifying the Appellant of the HICBC liability, despite HMRC's ability to verify the position directly without any need to contact the Appellant, amounts when seen as a whole to a reasonable excuse. It was not simply a situation of ignorance of the law." Hill was one of several HICBC penalty cases decided in 2020—see our guide to the High Income Child Benefit Charge for the full case law pattern.

Genuine inexperience — Jama v HMRC [2020] UKFTT 336 (TC)

Mr Jama found himself owing tax on money he hadn't actually received, in circumstances he didn't understand. He had no experience dealing with tax matters and lacked the skills to work out what was happening.

Judge Hudson found he had a reasonable excuse, noting that given Mr Jama's "naïveté and inexperience" and the fact that he was in a "baffling situation without the skills to rectify it," his failure to pay was reasonable.

Cases Where Reasonable Excuse Was Rejected

High earner with advisers — Niasse v HMRC [2024] UKFTT 179 (TC)

Baye Oumar Niasse, a professional footballer earning substantial sums, failed to file tax returns for multiple years. He claimed he didn't know he needed to file and hadn't received HMRC's notices.

The tribunal rejected his excuse. The judge noted that Mr Niasse was advised by professional accountants and had substantial ongoing income, yet failed to obtain relevant advice or file returns despite receiving notices. No reasonable excuse was established.

Relying On Others: What The Law Says

Paragraph 23(2)(b) of Schedule 55 FA 2009 states:

"where P relies on any other person to do anything, that is not a reasonable excuse unless P took reasonable care to avoid the failure"

In cases involving reliance on accountants or agents, tribunals have considered factors including:

Whether the taxpayer provided the agent with relevant information
Whether the taxpayer had any reason to doubt the agent was doing their job
Whether the taxpayer followed up at appropriate times
Whether the tax issue was something the agent could reasonably be expected to handle

The contrast between Barrett and Cruise v HMRC [2023] UKFTT 41 (TC) illustrates where the line falls.

In Barrett, the taxpayer provided information promptly, had no reason to doubt his accountant, and wasn't expected to independently research CIS requirements—reasonable care was taken. In Cruise, the taxpayer handed his affairs to an accountant but didn't check what the accountant was actually doing—he didn't verify whether his return had been filed and didn't monitor his HMRC account. That was not reasonable care, and his excuse was rejected.

Not Having Enough Money

Paragraph 23(2)(a) of Schedule 55 FA 2009 states:

"an insufficiency of funds is not a reasonable excuse, unless attributable to events outside P's control"

This means a lack of funds alone does not establish a reasonable excuse. The question is whether the insufficiency was caused by events genuinely outside the taxpayer's control.

Without Unreasonable Delay

Even if you had a genuine reasonable excuse, the defence is lost if you don't act quickly once the excuse ends. Paragraph 23(2)(c) of Schedule 55 FA 2009 states:

"where P had a reasonable excuse for the failure but the excuse has ceased, P is to be treated as having continued to have the excuse if the failure is remedied without unreasonable delay after the excuse ceased."

There is no statutory definition of "unreasonable delay"—no fixed number of days or weeks. The tribunal decides objectively, taking into account your circumstances. But the case law gives a clear sense of what works and what doesn't.

Days—accepted. In Howarth v HMRC [2025] UKFTT 499 (TC), Mrs Howarth discovered in March 2023 that her return had not been submitted. She filed it within days. Judge Gordon found she had "remedied the failure extremely quickly"—without unreasonable delay.

Seven months—rejected. In Allan v HMRC [2021] UKFTT 216 (TC), Mrs Allan received a penalty notice and saw online messages showing her return was overdue, but didn't file the return for another seven months. The tribunal found this was "a marked lack of expedition." Her initial belief that the return had been submitted may have been reasonable, but waiting seven months after being alerted destroyed the defence.

Practical takeaway: There is no bright-line rule, but the pattern is clear. Acting within days is safe. A few weeks is likely acceptable. Months of inaction after you know about the problem is not. The strongest position is to file the return, make the payment, or contact HMRC as soon as you become aware of the failure.

Mental Health As Reasonable Excuse

Mental health conditions can in principle amount to a reasonable excuse. Both the Upper Tribunal in Harrison v HMRC [2022] UKUT 216 (TCC) and the First-tier Tribunal in Breen v HMRC [2022] UKFTT 155 (TC) confirmed this.

But the bar is high. In Breen, the tribunal explained at paragraph 77: "there would in most cases need to be evidence that the mental health issue in question was such that the taxpayer cannot deal with his or her affairs to such an extent that the taxpayer cannot submit a return or perform the necessary preparation to submit a return." General stress or reluctance is not enough—the condition must have actually prevented you from complying.

In Harrison, the Upper Tribunal found that the taxpayer's claim of depression-related "avoidance symptoms" was not supported by any medical evidence, and the excuse failed. In Breen, a solicitor claimed a traumatic HMRC criminal investigation left him too afraid to file. The tribunal rejected this—his first mention of fear as a reasonable excuse came only after HMRC threatened further penalties, and contemporaneous correspondence did not support the claim.

If you are relying on mental health as your reasonable excuse, the case law suggests you will need:

Medical evidence—a GP letter, consultant's report, or similar documentation
Evidence of impact—showing the condition actually prevented you from dealing with your tax affairs, not just that it caused you difficulty or stress
Consistency—your account should align with any contemporaneous records (correspondence, phone calls with HMRC, etc.)

What Appellants Typically Include

In successful reasonable excuse appeals, appellants have generally addressed:

What prevented them from filing or paying on time
Why the obstacle couldn't have been avoided
What they did once the obstacle was removed—the law requires acting "without unreasonable delay"

Evidence that has supported reasonable excuse arguments includes:

Medical evidence where illness was involved
Correspondence showing what happened and when
A timeline of events and the appellant's response

The tribunal does not require formal witness statements, but in cases involving personal circumstances, appellants often provide a written account explaining the situation.

The Appeal Process

Penalty notices include information about how to appeal. The deadline to appeal is usually 30 days from the date of the penalty notice. If you've missed this deadline, a late appeal may still be possible.

Appeals are made to HMRC in the first instance. If HMRC rejects your appeal, you can request a review or appeal to the First-tier Tribunal. There is no fee to appeal to the tribunal.

You do not normally have to pay the penalty while your appeal is pending—HMRC will generally not enforce payment until the dispute is resolved. However, interest may continue to accrue on any underlying tax that remains unpaid.

If your case goes to the tribunal, most penalty appeals are decided on written submissions (the "Default Paper" category) rather than at an in-person hearing. See our guide to preparing for your tribunal hearing for what to expect.