In Eric Scowcroft v HMRC [2018] TC6527 a New Zealander's appeal against late filing penalties in respect of a Non Resident Capital Gains tax return was successful. He was unaware of the new filing requirement and his conveyancing solicitor did not point it out.

  • A New Zealander, sold his home in the UK
  • His Non Resident Capital Gains Tax (NRCGT) return should have been filed on 2 June 2017, he filed 105 days late.
  • HMRC assessed a £100 late filing penalty.
  • The taxpayer appealed.

He claimed to have a reasonable excuse for his admitted failure:

(1) That he expected his solicitor handling the sale to deal with any relevant tax obligations or at least to inform him of them.

(2) That he could not be expected to know of the new requirements to make a NRCGT return, and that his actions, or non-actions, were those of the reasonable person acting in the way HMRC say such a person should.

Judge Thomas found that:

  • The appellant had that genuine and honest belief that his solicitor should have informed him of the requirement to file a return.
  • It was objectively reasonable for him to assume that a solicitor carrying out a residential property sale would inform him, knowing that he was living in New Zealand, of any relevant tax obligation.
  • There was no doubt that the solicitor involved in that purchase would have informed the appellant of the SDLT liability and dealt with it.
  • The fact that the solicitor not only failed to inform the appellant of his obligation but took the view that he was not required to do so is neither here nor there.
  • The requirement to make an NRCGT return is not basic law that can reasonable be expected to be known by everyone who falls within its ambit.

The appeal was allowed.


Under Schedule 55 FA 2009 penalties applied under paragraphs 3, 5 and 6. The judge noted that HMRC only charged penalties under paragraph 3 and made some thoughts as to whether HMRC had the power to do so.

Links to our practical guides

How to Appeal a Tax Penalty

Penalties: Late filing

Grounds for Appeal: Reasonable Excuse

Non-Resident CGT: UK residential property

The Non-Residents' Tax Toolkit

Non-Resident Landlords Scheme

External link

Eric Scowcroft v HMRC [2018] TC6527