Peter Vaines tackles penalties, prison & other principal residences
- Failure to submit a zero return.
- Doing time: an unexpected or unusual event?
- New twist on principal private residence.
The case of Kaczmarczyk v HMRC TC 5744 has some hair-raising implications. Mr Kaczmarczyk was issued with a tax return but he did not send it back because he had no taxable income or gains for the year. However, HMRC still imposed a penalty of £3,500 for failing to submit a zero return. Their grounds derived from s 8 of TMA 1970, which says that the taxpayer ‘may be required by a notice given to him by an officer of the Board to make and deliver to the officer a return containing such information as may reasonably be required in pursuance of the notice’.
The tribunal held that upon receipt by a person of a notice under s 8, the recipient has an obligation to file a tax return for the year—and failure to do so gives rise to a penalty under Sch 55 of the Finance Act 2009. (I wonder if this extends to failing
