Inefficiency delays payment

The taxpayer incurred a capital gain on the disposal of a property that he owned jointly with his brother. The purchaser did not money immediately but expected to realise income from other developments to enable to him to pay for the property. The parties entered into a loan agreement for £600 000 and completion took place in July 2010.

The taxpayer included the gain in his 2010/11 self assessment return. The tax due on 31 January 2012 was £38 736. He visited his tax office On 9 February to discuss the matter; he was unable to pay it because the purchaser had come up with the money.

The taxpayer provided information for a time-to-pay arrangement. On 22 March HMRC told him his application had been refused and tax was due on 2 April.

He borrowed the money to pay but his cheque did not clear until 12 April; the...