In Roy Stanley v HMRC [2018] TC6199, a taxpayer was regarded as careless after supplying delayed and incomplete information to his agent. His agent also made share loss and negligible value claims out of time, despite being told that they were out of time by HMRC. The taxpayer was not penalised for his agent's actions.

A loss on the disposal (or deemed disposal) of ordinary shares in a qualifying trading company, the Share Loss can be set against income instead of capital gains. If there is no disposal a deemed disposal can be triggered by making a Negligible Value claim (NVC) this can be backdated.

Mr Stanley’s 2009/10 Return was completed by his accountant, who claimed relief for losses on shares (acquired under the EIS Scheme but relief was withdrawn) and companies that had since gone into liquidation. The losses were set against income for 2008/09 and 2009/10.

The return was filed late and so the claim for 2008/09 was out of time (the deadline being 31 January 2011). However, a letter had been submitted on 25 January 2011 including details of the claim.

The accountant filed returns including the claim for loss relief without authority from the taxpayer.

The FTT found

  • There being no actual disposal, the loss had to be triggered by a deemed disposal pursuant to a NVC.
    • Insufficient details were provided for the letter to meet the requirements of a NVC
    • The date of the deemed disposal in an NVC is the date of the claim unless backdated
    • The claims to loss relief on the Return were therefore invalid


Loss relief (income tax) disposal of shares 

Negligible Value Claims 

EIS: Enterprise Investment Scheme 

External Roy Stanley v HMRC [2018] TC6199