I have received JT's disappointing reply to my second request for HMRC to review the 772 successful NRCGT penalty appeals in the period to 31 December 2017 to establish how many used ignorance of the filing requirement as a reasonable excuse. His response was as follows:
As we have already told you, it would be too costly and resource intensive if we commission a review of all successful penalty appeals to 31 December 2017 for late filed NRCGT returns. Because of this, we will not conduct such exercise.
JT is HMRC's nominated individual responsible for ensuring his department follow the Taxpayers Charter and treat taxpayers even-handedly (fairly). There is clear evidence to suggest identical cases have resulted in totally different outcomes as higlighted in the example below:
I have successfully appealed against a NRCGT penalty. The wording of my letter was as follows and it was accepted without question:
"Further to your email of 17 June 2016, we write to appeal against the penalty of £800 issued to our client for the late submission of the non-resident capital gains tax return.
The circumstances are as follows:-
Our client has been living in Australia since 2012, during which time he rented out his property. The income has been declared on my client’s income tax return each year.
Due to my client’s absence from the UK, he was unaware of the new rules that came into force on 6 April 2015, requiring the CGT return to be completed within 30 days of the date of sale of the property. Hence, no CGT return was completed when the property was sold in November 2015.
When it came to our attention, the non-resident CGT return was filed without delay. You will see from the return that there is no tax due and therefore there has been no loss to HMRC. Both we and our client apologise for the delay in filing the return but are confident that you will be able to see that it was not a deliberate action.
We trust that, in the circumstances, the penalty can be removed.
In the meantime, our client has paid the amount due and so, if our appeal is successful, we should be grateful if this amount could be refunded as soon as possible."
The decrease in the successful NRCGT appeal rate from over 30% to just 3% is further clear evidence that HMRC has probably changed the goalposts and is not dealing with taxpayers in an even-handed manner.
Making mistakes is part and parcel of life, but to attempt to bury your head in the sand when a mistake is highlighted (with credible supporting evidence) is unacceptable. I would strongly argue that HMRC should be recording the reason why appeals are successful in the first place and I've not yet found the section in the Taxpayers Charter which states we will treat you even-handedly as long as it does not cost us too much.