CH160400 - Reasonable excuse: mental health

Mental health is a very sensitive and personal matter and customers` situations can be complex and hard to define. Symptoms can vary from anxiety, depression, or a personality disorder, amongst others.

Every case should be considered on its own facts.

Dealing with cases where mental health is a key consideration

Customers may be reluctant or find it difficult to disclose or talk about a health condition. The customer may contact our Extra Support Team from GOV.UK (This content has been withheld because of exemptions in the Freedom of Information Act 2000) .

Understanding how a mental health condition is currently affecting a person can help you understand how best to deal with the ongoing check, but it does not always explain why they missed their obligation.

Therefore, it is important that the person (and any letters of support) explain to HMRC not just what the reasonable excuse is (for example, a particular mental health condition), but also how that detrimentally affected their ability to comply with their tax obligation.

This means that it is important to ask the right questions such as:

  • what was/is the nature of your condition?
  • did it affect your ability to manage your tax affairs - if so, how?
  • did it affect your ability to deal or communicate with us - if so, how?
  • does anyone help you manage your tax affairs, such as a family member, friend or agent - if so, what arrangements were in place for this person to deal with us on your behalf?

For further detail on how to ask these sensitive questions, please refer to DMBM585185.

In some cases, you may need to ask the person to provide evidence of their health condition to help you decide on the appropriate action to talk. In respect of obtaining explicit consent to hold sensitive information of this type on file, please refer to DMBM585185.

Where it is appropriate to obtain evidence, you need to:

  • explain what evidence you require - as a minimum, evidence should confirm the nature of the illness
  • ask for an explanation of how it affected their ability to comply with their obligations
  • allow appropriate time for the evidence to be collected
  • suspend any unnecessary contact, possibly including any debt management action with the person whilst they collect the evidence.

Evidence of a person’s health condition can come from a number of sources. Acceptable sources include:

  • a doctor
  • a mental health professional
  • a social care professional
  • a voluntary sector organisation, such as Citizen’s Advice / TaxAid providing that they have satisfied themselves, from one of the sources above, that the health condition is genuine.

Note: You must ensure that any request for evidence you make is reasonable and proportionate and be aware that what you ask for may not actually exist. You should be prepared to accept alternative evidence which may be available.

In most cases, it should be possible to resolve cases locally through discussions with an authorising officer. (This content has been withheld because of exemptions in the Freedom of Information Act 2000)

If a person has a condition which has a substantial or long-term negative effect on their ability to carry out normal daily activities, it may also be classified as a disability. In such cases the continuing effects of illness may prevent the customer from complying with their obligations.

If a person is subject to a fluctuating condition which they know might reoccur, you should either consider:

  • whether or not it would be reasonable to expect them to put plans in place to try to ensure they comply with their obligations or,
  • whether their condition prevented them from doing so.

Example

Mr Y is an unrepresented self-employed builder without any support. He is diagnosed with post-traumatic stress disorder in July 2018. He has to stop working and finds it difficult to make certain decisions. He is therefore unable to complete his returns and calculate the tax due for 2018-19 on 31 January 2020 or to appoint an agent to help him. Following a period of treatment, his condition improves sufficiently to allow him to make decisions and appoint an agent to help him and he is able to return to work in May 2020. He completes his tax return in June and pays the remaining tax due shortly thereafter.

Mr Y provides medical evidence of his condition and the period of treatment, with an explanation of how it prevented him filing and paying on time, so we accept that the customer has a reasonable excuse. This means that no penalties are due because he fulfilled his tax obligations soon after the excuse has ended.