Penalties for failure to submit return on time

A married couple who lived in Canada jointly owned a property in the UK that they sold in May 2015. As non-UK residents they were obliged to report the sale in a non-resident capital gains tax return within 30 days of completion. Each filed a return late so HMRC imposed penalties.

The husband and wife appealed individually. Both said they had been unaware of the requirement and assumed they had to report the disposal in their normal UK tax returns. Further they had relied on the conveyancing solicitor and were entitled to expect that a professional would know the law.

The First-tier Tribunal judge said there were other cases – over which he had not presided – in which ignorance of the law in this respect was deemed to amount to reasonable excuse namely McGreevy (TC6109) and Saunders (TC6173). He too had allowed appeals on this basis including D Wickenden (TC6642) and J Wickenden (TC6643). However ...