Aware of its obligations

Penalty for filing ATED returns late

The taxpayer was a property development company. It owned UK residential properties which were potentially within the charge to the annual tax on enveloped dwellings (ATED) although an exemption applied to property development companies. The company did not submit ATED returns for 2013-14. Further because five properties were involved five separate returns were due. HMRC imposed penalties for each missing return. The company filed the returns as soon as it realised they were required.

The taxpayer appealed against the penalties.

The First-tier Tribunal found that the penalty notices in relation to four properties were invalid because they contained the wrong date for the filing of the ATED returns. These would be cancelled. This left one valid penalty notice.

The taxpayer claimed it had reasonable excuse for failing to file the ATED returns on time. It had relied on its accountant and...