SDLTM86450 - Compliance: Penalties

Culpability: Defences and responses: Failure to notify a transaction

Defences

A purchaser may claim that they did not notify HM Revenue & Customs because

• they did not know there was an obligation to notify HM Revenue & Customs of the transaction
• HM Revenue & Customs already knew about the transaction
• they had telephoned or called at a Stamp Office or Tax Office and were told there was no need to file a land transaction return
• the liability depended on technical considerations, for example contingent or unascertainable consideration
• they had been ill, absent or had family or other problems

Responses

Obligation to notify (ignorance of the law)

Ignorance of the law is not a reasonable excuse.

Where the liability turns on a technical consideration which an un-represented purchaser might not appreciate, or on a disputed point of law, or a debatable view of the facts (for example, property dealing or an illegal activity) a realistic view of the purchaser's actions should be taken. The point may often, in practice turn on the compliance caseworker’s (or the Commissioners') view of the purchaser's credibility as a witness.

Seeking advice (This text has been withheld because of exemptions in the Freedom of Information Act 2000)should be considered before taking any positive action in such a case.

Amount of purchase price to attract liability

The excuse may depend on figures. If the purchase price has been intentionally deflated to reduce stamp duty land tax liability around a threshold with the declaration of over-inflated fixtures and fittings, for example, careful note should be taken of signs of intentional evasion.

Illness etc

It is possible that illness, absence or family problems would persist at such a level, throughout the 30 day period during which the transaction could be notified, as to constitute a reasonable excuse for an extended period.

However, even if the purchaser's difficulties were at their worst at the time of purchase, they should still be able to find time to comply with their statutory duties within a reasonable time thereafter.

The purchaser would presumably have been able to instruct an agent to do what was necessary whilst the sale was ongoing and therefore would be able to instruct an agent to do what was necessary with regard to the land transaction return.