Summary
The use of estimated figures on the taxpayer’s tax returns amounted to deliberate rather than careless behaviour for the purposes of penalties for tax return errors.
Background
The appellant, a self-employed heating and plumbing engineer, submitted his tax return for 2009/10 showing estimated business turnover of £20,000 and estimated net profits of £20,000.
HM Revenue and Customs (HMRC) opened an enquiry into the appellant’s tax return for 2010/11 in December 2011. At that time, his tax return for 2006/07 showed business turnover of £15,000 and net profits of £15,000; his 2007/08 tax return showed business turnover of £16,000 and net profits of £16,000. The tax return for 2008/09 had not then been submitted.
Subsequently, the appellant’s accountants prepared accounts for the
