As we move into the last two weeks of self assessment filing, we have some top tips for late filers, some cases of penalties and many updated guides.

I noticed yesterday that HMRC seemed to be playing with their live site and the agent logins. I was briefly trapped in by a screen asking me to select a new additional method in order to acquire an extra login code. Quite scary, this is hardly the best time to test a new system. 

We have recently noticed changes to some of HMRC's helpsheets; they seem to have changed their view over the way that a schedule 24 FA 2007 penalty for error is calculated. The change is not supported by the legislation and is not consistent across all their publications.

On the theme of 'lack of consistency' we report two penalty appeals for late Non Resident CGT returns, the FTT going against two previous decisions and this time finding that ignorance of the law is no excuse. 

Finally, I was on a forum last night and I can see that people are constantly confused by the wholly and exclusively rule: it seems to be a common problem. What matters are your intentions when you incur the cost and if there is an intention to use something for business, you should be able to apportion the cost. In the freeview section of this weeks wire we have a use of home calculator which may help.

If you have any tax queries please do try out our Virtual Tax Partner support portal at www.VtaxP.co.uk: subscribers you are entitled to free quick queries so do ask.

Enjoy the guides and updates and the news is below. 

Back soon

Nichola Ross Martin FCA Tax Director


Your Virtual Tax Partner®: online PRACTICAL support for accountants & tax advisers BY accountants & tax advisers

Quick news (freeview)

Tax refunds: HMRC policy change
HMRC may not repay any overpayment in line with the instructions that you provide on your tax return.

New penalty calculation creates confusion
HMRC have updated a number of compliance checks factsheets over recent weeks and this has lead to confusion as to what extent penalties will be reduced for the timing of a disclosure.

Use of home as office calculator
Our use of home calculating tool is part of our Working from home toolkit. Remember, there are different rules for companies and their directors.

Case Update (freeview)

Ignorance is not an Excuse
In Hesketh v HMRC [2017] TC06266 the First Tier Tribunal found that the taxpayer’s ignorance of the filing obligations for Non-Resident Capital Gains Tax was not a reasonable excuse for the late filing of their NRCGT returns and upheld the penalties. This is interesting as it goes against the decision in the Rachel McGreevy case.

Special Relief Allowed
In Welland v HMRC [2017] TC06265 the First Tier Tribunal (FTT) found that the taxpayer’s ignorance of the new rules for Non-Resident Capital Gains Tax was not a reasonable excuse for the late filing of his three returns. The penalties were upheld, but special relief was granted to reduce the penalties on the last two returns to nil.

Tax barrister avoids deliberate error penalties
In Patrick Cannon v HMRC [2017] TC06254, the First-Tier Tribunal (FTT) quashed two of three penalties for a tax barrister, finding he had taken reasonable care despite misunderstanding the furnished holiday let rules.

Rangers advisers negligent re Employee Benefit Trust
In Barker v Baxendale Walker Solicitors (a firm) & Ors [2017] EWCA Civ 2056 the Court of Appeal found that the solicitors advising on an EBT structure were negligent in not warning their clients that the scheme could fail.

Editor's Choice (subscribers)  

2016/17 Self Assessment tax return toolkit
An essential summary of last minute tips if you have still to file a return, a 'what’s changed since 2015/16' and top tips for 2016/17 tax return completion. 

Self employed: what expenses can I claim (index)
Your FAQ answered in a series of hand guides

Tax Guides and Updates (subscribers) 

As part of our self-assessment special we have refreshed the following guides, more to come next week:

Furnished Holiday Letting
UPDATE: to qualify as a holiday letting the occupants do not actually have to be on holiday. If the conditions are met, it is an FHL and can be treated as a trade for income tax, corporation tax and CGT.

Non Resident CGT: UK residential property
UPDATE: Including our comments on the contrasting verdicts in cases involving late non-resident CGT returns.

Penalties: Errors in Returns and Documents
UPDATE: revisit our guide following HMRCs confusing new wording included in their updated factsheets.

Marriage Allowance (Transferable married couples allowance) (freeview)
UPDATE: this tax reducer can be worth up to £230 in 2017/18 but it cannot be claimed on a Tax Return. It must be claimed online.

Personal allowance: who is entitled to claim
UPDATE: if you have any individuals living abroad, or who have just come to the UK, you may need to check entitlement to a UK personal allowance in order to complete their Self-Assessment Tax Return. Our guide can help.

VAT (freeview)

Zero-rating applies despite retention of existing building
In HMRC v Astral Construction Limited [2015] UKUT 0021, the Upper Tribunal (UT) found that a new nursing home constructed on the site of a redundant church, and which incorporated the original church, could still qualify for zero-rating.

VAT (subscribers)

VAT: Land and Property (notes)
UPDATE: two cases have been added to our guide which look at when construction services are zero-rated and when they are standard rated construction services to an existing building.

CPD Webinars

New CPD click here

Missed last time's update?

Nichola's SME Tax w-update to  12 January 2018 


  • Late filing penalties
  • SA special
  • CGT and negligible value
  • CGT private residence relief
  • New VAT condocs
  • and much more..

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