Unreasonable assumption

Late filed non-resident capital gains tax return

The taxpayer had been resident in Saudi Arabia since 2012. She continued to file self-assessment returns because she received rental income from a UK property. She sold the house in November 2015 and should have filed a non-resident capital gains tax return within a month. But she failed to do so instead including a capital loss in the capital gains pages of her 2015-16 return. HMRC imposed penalties and the taxpayer appealed.

She said she had a reasonable excuse. She was not aware of the requirement to submit the non-resident capital gains tax form and without notification by HMRC she had ‘no ability to know’ what she could not know.

The First-tier Tribunal noted that according to HMRC the taxpayer had an obligation to stay up to date with UK tax legislation. This included reading the chancellor’s autumn...