The first tier tribunal allowed an appeal that was four years late.
Under Taes Management Act 1970 s29, an appeal must be made within 30 days unless there is reasonable excuse. A late appeal may be allowed by HMRC or a tribunal.
The case related to discovery assessments for inheritance tax in respect of Mark Collins who died suddenly, without a will, in August 2013. Collins had a buy-to-let portfolio of more than 50 properties.
The family had not been involved in this portfolio, and had difficulty coping with it. His wife was finally appointed as personal representative when probate was granted in July 2015.
In 2013, a litigious claim was made against the estate for £233,000. This was resolved in the family’s favour in December 2014.
In December 2013, HMRC issued assessments for £326,000. The total due to HMRC from the estate increased under debt management litigation to £444,475. The net value of Mr Collins’ estate for probate was £714,480.
The family and their solicitors corresponded with HMRC between 2014 and 2016. Protective appeals were rejected by HMRC in 2017.
In deciding whether to accept a late appeal, the tribunal noted that:
- there was reasonable excuse until the litigation was resolved,
- litigation reasonably caused the family to ignore the tax assessments
- had the appeals been made in 2015, they would probably have been stood over until 2017
- the family were justified in looking at the £444,475 judgment debt. The tribunal could not see how this figure had been determined
- there seemed to be good grounds to challenge the assessments
- granting the appeal would not unduly inconvenience HMRC.
The judge said that this was a finely balanced situation. On balance, he decided that the balance favoured the taxpayer.
The case can be downloaded from here.
Personal representatives of Mark Collins [2018] TC 6597 [18.08]