A recent First Tier Tribunal case examined whether a company director had an obligation to submit a Self Assessment tax return without receiving a notice to file. The taxpayer in question appealed against penalties totalling £1,300 relating to his 2014-15
Self Assessment return on the basis that he had a reasonable excuse for his appeal.

Part of the appeal was based on the interesting anomaly that there is no legislation stating that an individual must file a tax return on the sole basis that they are director of a company. The taxpayer also contested that he had never received a notice
to file a 2015 tax return and that had he done so, he would have filed a return immediately, and that as he had no liability that tax year, it would have been very easy and straight forward for him to do so.

HMRC’s guidance states:
'As a director of a limited company, you must: register for Self Assessment and send a personal Self Assessment tax return every year.'
The Tribunal agreed that this guidance does not have the force of law and that the taxpayer was under no obligation to follow it. The Tribunal went further, saying that the guidance does not accurately reflect what the law says. The taxpayer also stressed
that he had paid tax on his employment income through PAYE and had no further tax to pay.
The Tribunal agreed that the taxpayer had a reasonable excuse and his appeal against the penalties was allowed in full. It is unlikely that this case will change HMRC’s position in respect of directors of limited companies being required to file tax returns
annually, but this case has highlighted an apparent discrepancy between HMRC's guidance on this matter and the underlying legislation.
Planning note: We are waiting for the dust to settle, and for informed opinion to reach a conclusion on this issue, before considering any action that may be required for our director clients. To some extent, the matter will be resolved
if HMRC's plans for Making Tax Digital proceed. Over time, this process will lead to the end of a requirement to submit an annual tax return for most taxpayers.