Clear intention to pay

In 2009/10 the taxpayer sold a farm asset with the intention of rolling over the gain. But in January 2014 he notified HMRC that he had not reinvested the full proceeds. Two months later the Revenue issued a revised capital gains tax assessment. The taxpayer was unable to raise the cash to pay the bill so he contacted the debt management unit with a view to making a time-to-pay arrangement. He paid part of the tax in May 2014 and the balance in October 2014.

HMRC issued a late payment surcharge in June 2014 against which the taxpayer appealed.

The First-tier Tribunal said the taxpayer had acted “entirely reasonably”. He had informed HMRC that a tax obligation had arisen because rollover relief was not fully available. The department’s delay in responding had reduced the time for the tax to be paid within the time limit. The...