This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies. To find out more about cookies on this website and how to delete cookies, see our privacy notice.

Taxpayer who relied on non-genuine case law generated by AI did not have reasonable excuse for failure to notify chargeability

By Mark McLaughlin, February 2024

Cases cited in the taxpayer’s appeal which were generated by artificial intelligence were not genuine and the taxpayer’s mental health issues and ignorance of the law were not reasonable excuses for her failure to notify chargeability to tax on a property disposal.

In 2006, the appellant purchased a property (SR) for £135,000. SR was let out to tenants from 2007. The appellant did not notify HM Revenue and Customs (HMRC) that she was liable to tax on the rental income. She had never previously completed a tax return. In October 2018, SR was sold for £252,000. The solicitors did not provide the appellant with any advice about capital gains tax (CGT). However, she was aware that there would “…possibly be some tax to pay” and that HMRC “would want money”. Having estimated the CGT payable, the appellant put £20,000 into government bonds. In July 2022, HMRC issued a CGT assessment and charged a penalty of%

Subscribe to the McLaughlin’s Tax Case Library to get instant access
to the Tax Case Library.
14 day free trial , 90 day money back guarantee
Subscribe

Related or similar articles

Loan notes were not registered in Jersey upon their redemption
By Mark McLaughlin, June 2026
Taxpayer entitled to entrepreneurs’ relief as LLP had commenced trading
By Mark McLaughlin, September 2024
Property held on constructive trust for family member
By Mark McLaughlin, July 2024
Application for judicial review of HMRC’s treatment of a clearance application as void refused
By Mark McLaughlin, November 2020
Writing Off Part Of Qualifying Loan Created Allowable Loss
By Mark McLaughlin, October 2018