Penalties - new approach?

We have almost reached deadlock with HMRC over a "main residence" claim. They have ignored most of our arguments and are simply repeating that there was not sufficient "permanence" for an election. I don't really want to get into the details as my point relates to penalties. In 25 years I have never know HMRC to look for penalties on a point of interpretation, which they themselves have said is "on balance". My client is tempted to go to the First Tier Tribunal but the tax is not substantial and he sees that it is a subtle point of fact and law. But he refuses to pay a penalty and I am sympathetic. HMRC have been offered, verbally that he would accept their case as long as penalties were not sought.  They have refused this offer and said that in order for them to decide if penalties are appropriate they need to know:

"For what reason did you consider that PPR and Lettings relief was due

What advice were you given by your advisor (sic) whilst completing the return

What information/documents did you provide to your advisor relating to the completion of the return

Did you consult any HMRC guidance or helpsheets? If so please confirm what you looked at"

We are a long established firm of Chartered Accountants and I am also a CTA and have never been asked this before. It seems outrageous for HMRC to ask this type of question.  Any advice urgently sought.

 

 

 

 

 

 

 

 

 

Comments
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Check your PI policy

Roland195 |

Thanks (I think!).  But on

irmcleish |

I suspect

Roland195 |

I've recently see this although I only know bare facts

rockallj |
rockallj's picture

Thanks for that.

irmcleish |

Presumably

ACDWebb |
ACDWebb's picture

Thanks

irmcleish |

carelessness

Anthony123 |

One might even say

ACDWebb |
ACDWebb's picture

If your client has complied

Duncan Cameron |

solution?

Taxcon |

Beware

gtmaynard |

HMRC guidance or helpsheets

ianthetaxman |
ianthetaxman's picture

Toolkits

EGo |

Toolkits

ianthetaxman |
ianthetaxman's picture

Same experience

mirrored |

So far out of line

mackthefork |

Unprofessional and unethical

mackthefork |