Rachel McGreevy v The Commissioners For Her Majesty's Revenue & Customs, TC 06109
| Jurisdiction | UK Non-devolved |
| Judge | Richard THOMAS |
| Judgment Date | 12 September 2017 |
| Neutral Citation | [2017] UKFTT 0690 (TC) |
| Respondent | The Commissioners For Her Majesty's Revenue & Customs |
| Appellant | Rachel McGreevy |
| Reference | TC 06109 |
| Court | First-tier Tribunal (Tax Chamber) |
[2017] UKFTT 0690 (TC)
TC06109
Appeal number:TC/2017/04089
CAPITAL GAINS TAX – non-resident CGT return – penalties of £1,600 for failure
to file return within 30 days of completion of house sale – whether disposal in 2015-
16: not proved, so penalties not due – alternatively, whether assessment met
requirements of paragraph 18 Schedule 55 FA 2009: no, but s 118 TMA applies –
whether paragraph 4 Schedule 55 penalties properly imposed: no, Donaldson
applies and no paragraph 4(1)(b) HMRC decision – whether reasonable excuse: yes
– whether special circumstances decision by HMRC flawed: yes – decision that
there were special circumstances substituted – penalties cancelled.
FIRST-TIER TRIBUNAL
TAX CHAMBER
RACHEL McGREEVY Appellant
- and -
THE COMMISSIONERS FOR HER MAJESTY’S Respondents
REVENUE & CUSTOMS
TRIBUNAL:
JUDGE RICHARD THOMAS
The Tribunal determined the appeal on 8 September 2017 without a hearing
under the provisions of Rule 26 of the Tribunal Procedure (First-tier Tribunal)
(Tax Chamber) Rules 2009 (default paper cases) having first read the Notice of
Appeal dated 17 May 2017 (with enclosures) and HMRC’s Statement of Case
(with enclosures) acknowledged by the Tribunal on 21 July 2017.
© CROWN COPYRIGHT 2017
2
DECISION
1. The penalties under appeal are for the tax year 2015-16 (though the HMRC
Statement of Case (“SoC”) describes that tax year as the “period ending 2015-16”)
and are said to consist of: 5
(1) £100 for failure to file by the due date
(2) £300 for failure to file by 6 months after the due date
(3) £300 for failure to file by 12 months after the due date
2. Astute readers will note that no daily penalties are included. The reason for this
will become apparent. 10
The facts
3. I take the facts from the SoC filed by HMRC and from the documents attached
to that Statement.
4. On 7 August 2016 the appellant submitted an NRCGT return in electronic
form1. The printout of the return entries shows: 15
(1) the appellant’s address as 203/47-51 Lilyfield Rd, Rozelle, NSW,
Australia 2039,
(2) the gain related to the disposal of a property at 91 Lullingstone Crescent,
Orpington, Kent, BR5 3DY,
(3) the date of conveyance was 7 July 2015, 20
(4) no election was made for an alternative method of computation,
(5) any gain was exempt because of private residence relief (“PRR”), and the
property was said to have been the private residence of the appellant up to 1
February 2011, and
(6) the amount of CGT due was nil. 25
5. On 6 September 2016 HMRC (NRCGT) wrote to the appellant. The letter was
headed “Non-resident Capital Gains Tax (NRCGT)” in large bold type. The next two
lines also in bold type were “Late filing penalties” and “These Penalties total £1600”,
the second being in larger type than the first.
6. After salutations and the address of the property, the letter continued: 30
“I have received a NRCGT return from you relating to the
disposal of the above property on 7/7/15.
This property was subject to NRCGT and, you were required to
file an NRCGT return within 30 days of the sale being finalised
which was 6/8/15. 35
We did not receive this return until 7/8/16
1 There appears to be no facility for printing the return or obtaining a paper copy and sending it by post
or delivering it directly. I discuss the lawfuln ess of this later.
3
This is a notice of assessment for a late filing penalty under
Schedule 55 of the Finance Act 2009.”
7. The second page contained the actual notice of the assessment which charged
£1,600, broken down as set out at §1, but also including a daily penalty of £900.
8. Appeal rights were then described, that an appeal must be made in writing 5 within 30 days. The letter contained no name of an officer.
9. On 21 October 2016 the appellant wrote to HMRC’s Leics. and Northants Area
office appealing against the penalty assessment.
10. She said:
“With reference to the late filing, I understood that the CGT 10 would be payable as part of the Self-Assessment, which I submit
annually as a non-resident. We are required to complete this and
send it to the HMRC by October following the end of the
financial year, which I duly did in good faith.
It was not until I initiated the Self-Assessment and read the 15 section associated with CGT that I became aware of the
requirement to submit the CGT return within 30 days of the
competed sale. I had absolutely no idea this was necessary and I
had received no previous advice to do this.
On finding out that a separate CGT assessment process was 20 necessary, I completed the submission without delay and at no
time sought to evade or avoid this, so I believe any penalty is
grossly unfair. For this reason I am appealing the penalty.
In addition to this, the notice was issued on 8th September 2016
and has taken approximately six weeks to reach me – well 25 beyond the due date!”
11. On 3 February 2017 the NRCGT Team replied. The heading of their letter said
the appeal was against the penalties for sending in a return late for 2015-16. [It
actually said “for the 2015 to 2016 tax year” which does not make a great deal of
sense to me] 30
12. The body of the letter started:
“You told us that you didn’t send your tax return in on time
because you had no idea that a [NRCGT] tax return was
required.”
13. The Team rejected the appeal on the grounds that the appellant had no 35 reasonable excuse. It was, they said, her responsibility to ensure that an NRCGT
return was submitted on time as all the relevant information had been clearly
publicised on the “Gov.uk” website. “It [sic] states the process, timelines and what
penalties will be charged if the return is submitted late.”
14. The letter goes on to give HMRC’s view that a reasonable excuse will only exist 40 when an unexpected or unusual event, either “unforeseeable or beyond your control”
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