Postby etf » Mon Jun 04, 2018 4:22 pm
This post is a bit off track, but potentially highlights the uneven handed treatment currently exhibited by HMRC when imposing NRCGT penalties.
Where a non-resident landlord receives their rent direct from a tenant, the tenant is usually obliged to withhold tax from their rent before paying it over to HMRC, unless HMRC has authorised them to pay it to their landlord gross. Penalties can be imposed on a tenant if they fail to make the necessary returns to HMRC, although in my 34 years in expatriate tax I have never heard of one of these penalties being levied. I am sure I recall speaking with HMRC staff and being told 'we appreciate a tenant will probably not know about their reporting obligation and so we adopt a common sense approach and do not routinely issue penalties'. A very sensible approach to adopt if I may say so. A freedom of information request asking for the number of penalties levied on tenants during the 2017 calendar year will demonstrate whether my understanding is still correct.
Assuming the above analysis does still hang together, how does it sit with the Taxpayers Charter which confirms HMRC will treat taxpayers even handedly?
My answer is 'very uncomfortably', because if HMRC can adopt a common sense approach as detailed above, but act like Donald Trump when it comes to NRCGT penalties (an equally obscure filing obligation as demonstrated by the 44% of taxpayers who were late filing in the last quarter), the playing field looks more like the Himalayas than the even surface of Wembley Stadium which should surely be HMRC's goal.