Such transactions can often be a one-off, like the sale of a business or a second home, and a recent tax case has highlighted the need to get the details right on disposals like this.

The First-tier Tribunal (FTT) case of Cox & Anor v Revenue and Customs considered an appeal by the taxpayers in relation to penalties charged by HMRC. The case involved an erroneous claim that Entrepreneurs’ Relief (ER) (now known as Business Asset Disposal Relief) applied to a disposal of shares and the taxpayers contended there were grounds for associated penalties to be suspended by HMRC.

It is possible, in certain circumstances, for all or part of a penalty charged by HMRC in respect of a careless inaccuracy to be suspended. Precisely what constitutes a careless inaccuracy is assessed on a case-by-case basis and is also a discretionary matter for HMRC.