Moving on

Money Laundering Regulations – fit and proper test

The taxpayer appealed against HMRC’s decision that its sole director M had failed the ‘fit and proper’ test for the purposes of the Money Laundering Regulations 2007. The Revenue reached its decision based on under-declared income in M’s 2010-11 and 2011-12 tax returns for which deliberate inaccuracy penalties were imposed and which he had not challenged.

The director accepted his affairs had been disorganised in the past but that his record-keeping and financial management methods had improved significantly. Further he had paid the penalties for reasons of expediency and to draw a line under the situation. He had not thought it worth the time or money fighting them but this did not imply he considered his behaviour had been deliberate.

The First-tier Tribunal concluded that the errors in the earlier returns had been careless rather than deliberate. But...