CGT liability from 2003 need help

[mullet]

I think it maybe too late to appeal now and I am stuck with the outcome.

If HMRC's case is ongoing then it is not too late to appeal, as the 30-day appeal period does not start until they make an "appealable decision" which is usually an amendment to a tax return (if an enquiry case) or an assessment (if a discovery case). But remember that an appeal has to have grounds, and the onus of proof is on the appelant - HMRC won't just take your word for it so you will have to provide evidence which satisfies them.

It is possible that the outcome with which you may be stuck is the correct outcome in the circumstances, since you cannot change historical facts regarding the ownership of an asset. CGT planning really needs to happen before a disposal. And sometimes even before the acquisition. Remember that you are on the back foot here, since you did not declare this disposal.

[AvocadoK]

The six year time limit does not depend on when HMRC made the initial contact (March 2011) . If they did not raise an assessment in March 2011 for 2004/05, they are out of time now, unless there is evidence to show that the omission of the gain was a deliberate error. That's where the onus is on them.

Wamstax makes the point that it may be harder to show that the error was other than deliberate if there were other errors on the return. In strictness, each error should be looked at on its own, so it is possible to have deliberate and non deliberate errors on the same return (I have recently concluded a case where that happened). In practice, HMRC will try to tar all errors with the same brush, but 'then sometimes HMRC need to be educated!

Of course, you might want to pay the tax, even if HMRC cannot legally assess it. Don't let me stop you from that! I am giving advice based on the legislation, that's all.

AK

[wamstax]

Hi there you have some chance and as regards engaging a professional you need to be sure that the person has the experience and ability to deal with the matter fully and efficiently. Ask them for testimonials (if they are not already on the website) and consider whether they are reasonable and realistic. Beware of the self promoting fee generating egotist who hasn't actually dealt with any practical cases of these sorts.

To judge whether you have a realistic chance of success all you need to do is ask HMRC under what statutory provisions and based on what facts and considerations do they consider that they can make formal assessments on you. If they come back and say they can't you have succeeded - if they come back with a load of waffle or incorrect assumptions or facts then you would have to consider whether the professionals fees would be more than offset by what you are likely to gain.

Hope that this helps
bill@wamstaxltd.com

http://www.wamstaxltd.com

[maths]

The Lawson v Revenue and Customs [2011] UKFTT 346 (TC) to which you refer is of interest but not perhaps of general application.

In that case wife was legal owner of the property; property was sold and she argued the capital gain should be spit between her and husband as they each had a beneficial interest on the property; the FTT agreed with her. However, their decision was heavily based on the credibility of her as a witness and the overall way in which the family operated in regard to ownership of properties. However, the fact you state you and the wife operated only joint bank accounts is of help.

If you are correct and the property to which you refer was in fact owned beneficially by you and your wife, then she has also (I assume) failed to disclose the capital gain on her tax return(?); would this be a problem to you?

The intention of you and her at the time of purchase as to beneficial ownership is important;
as legal owner did you execute a declaration of trust in favour of you and her;
did she provide any part of the purchase price from her own monies;
what instructions were given to the solicitor re ownershipetc