Fifty shades of HICBC: Courts play penalty lottery
The first tier tribunal (FTT) system has recently heard a large number of cases challenging penalties for failing to report the HICBC. Andy Keates investigates how taxpayers can resist such penalties.
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I have dealt with two such cases where in one the husband claimed ignorance of the legislation and in the second he believed that his wife had stopped claiming. HMRC agreed in both to suspend the penalties.
Here's a good idea. Instead of expecting people to file tax returns solely because of HICBC, why don't they just send a P800 and unilaterally adjust their PAYE code? Then it would be up to the taxpayer to appeal if they are no longer living with the claimant.
They mess up our tax codes in 101 different ways these days, yet for something like this, where it is clearly the best solution, they don't bother.
Perhaps they just prefer charging penalties. That's probably why they didn't make solicitors deal with NRCGT returns (or the new 30 day disclosure form) or even make it mandatory for them to inform their clients they have to do it themselves.
It really makes you wonder whether it's just a total failure of common sense or some sinister plot to trip taxpayers up every way they know how.