We were engaged by a husband and wife to prepare a disclosure under the Let Property Campaign.
The calculations were particularly complex due to a series of structural changes to the property over a period of more than 30 years.
The clients had acquired the property in stages, resided in part, and let out other parts to meet their mortgage payments. Over time, the areas occupied by the clients and those let to tenants changed, further complicating the position.
After a thorough review of the facts and the clients’ personal circumstances, we believed the wife had a reasonable excuse for failing to notify chargeability to HMRC. A full disclosure and offer were submitted on the basis that only four tax years were assessable, and no penalty was payable due to reasonable excuse.
HMRC initially challenged this, seeking tax for 20 years and a 30% penalty. Confident in the strength of our position, we stood firm and submitted a comprehensive technical analysis of the reasonable excuse and case law provisions, demonstrating how they applied to the specific facts of the case.
HMRC ultimately accepted our position, resulting in a final liability of £2,900. This was significantly lower than the amount sought, which exceeded ten times that figure.
This was a fantastic outcome for our client.