More than half of tax appeals brought to HM Revenue & Customs (HMRC) are upheld, according to a new report.
The latest figures show that HMRC fines and penalties were quashed in 52 per cent of cases. This increases to 66 per cent for VAT penalties.
The overall number of reviews also increased, from 27,000 the year previous to 29,500.
The system for issuing penalties for failing to submit a tax return on time is increasingly automated, which means a wide range of taxpayers may have a genuine excuse for being late.
Taxpayers who feel as though a fine is unfair can appeal the decision to HMRC, or bring the complaint before a tax tribunal.
The chances of winning a claim at a tax tribunal is much lower, with the latest figures suggesting that around 84 per cent of cases are awarded in favour of HMRC.
Asking for a review or escalating your case to a tax tribunal is currently free, although the Government is consulting on introducing fees of up to £2,000 for the most complex tribunal hearings.
An HMRC spokesperson said: “The number of statutory reviews requested each year is a very small proportion of the many hundreds of thousands of appealable decisions made each year.
“While we always remain alert to any emerging trends in these figures over time, we don’t consider the small increase on previous figures to be significant.”
