Suitability of grounds for reasonable enjoyment of house

In 2014 the taxpayers sold their main residence which they had bought in 1997. They did not include the gain in their tax returns because they believed it qualified for only or main residence relief (TCGA 1992 s 222 et seq). HMRC found out about the disposal and decided the property which had grounds of 0.94 of a hectare was not of a size and character to merit gardens of more than the normal statutory maximum of 0.5 of a hectare. It raised a discovery assessment for capital gains tax. The taxpayers appealed.

The First-tier Tribunal referred to the taxpayers applying for permission to notify a late appeal to the tribunal. The judges said this was unnecessary because the couple had not requested a review of HMRC’s decision – nor had HMRC offered one. In that circumstance there was no time limit (TMA 1970 s 49D)....