In the light of two recent tax cases, Rose Duly, Tax Consultant at Ward Goodman, has highlighted the benefit of taking a hard look at the facts and fighting HMRC if they have not applied rules fairly, even if you have not had timely advice.
Rose, explained:“In the Scowcroft v Revenue case, the overseas taxpayer was not advised to make a non-resident return on selling a UK property at a loss. The eventual return was made late and HMRC charged him late filing penalties. Mr Scowcroft was able to show that he had acted reasonably, and the penalty was cancelled.
In the second case, Mr Ames misunderstood the law about making EIS claims and consequently faced a large CGT bill. Part of the reason he misunderstood was down to misleading advice from HMRC, and HMRC also did not allow him to make a late claim (which would have zero’d the tax bill). HMRC is allowed to accept late claims in exceptional circumstances, but it was evident that they had not considered all the circumstances when they refused to allow Mr Ames to do this. Judicial review has required HMRC to reconsider the late claim.
If you are non-resident selling property in the UK, or if you have made EIS investments in a year where your income is too low to give the income tax relief, please do come to us for timely advice, rather than rely on fighting HMRC through the courts many years later.