TC09585 - [2025] UKFTT 00867 (TC)

Mr Gordon made three separate points on this, as follows.

First, he said that, whilst he accepted that the Appellant’s disclosure of the disposal of 8 Wigshaw Lane had been “prompted”, by virtue of Officer Weir’s letter of 29 August 2017, the Appellant’s disclosure of the disposal of the other three Properties had been “unprompted” and therefore the correct range for any penalty in the case of the Appellant’s failure to notify the gains on each of those three Properties was 10% to 30% – and not 20% to 30% – of the potential lost revenue.

Secondly, he said that the practice of the Respondents described in paragraph 120 above, which was the one that had been adopted in this case in the SOC, was not in accordance with the terms of paragraph 13 of Schedule 41.

The way in which that paragraph operated was that:

The above meant that whatever percentage the Respondents considered to be appropriate to reflect the quality of the disclosure was required to be applied to the standard percentage and deducted from the standard percentage to calculate the percentage of the penalty, subject only to the fact that that percentage could not be lower than the minimum amount specified in paragraphs 13(2) and 13(3) of Schedule 41.

In this case, the Respondents had indicated in the SOC that they considered 70% to be the appropriate discount for the disclosure which the Appellant had made. The method described in paragraph 138 above meant that that figure needed to be applied to the standard percentage (30% in this case) to give rise to a discount of 21% under paragraph 13(1) of Schedule 41 but then the discount needed to be reduced to 20% under paragraphs 13(2) and 13(3) of Schedule 41 so as to ensure that the penalty percentage was no lower than the minimum of 10%.

However, the Respondents had instead applied the discount to the difference between the standard and minimum percentages in each case and deducted the amount so calculated from the standard percentage. This led to an unreasonably high penalty percentage.

Finally, he said that, in any event, the percentage discount of 70% for the Appellant’s disclosure was too low and that he was entitled to a discount of 100% due to the quality of that disclosure. The Appellant’s disclosure had been full and prompt. He had answered the Respondents’ questions, provided the Respondents with access to such records as he had and explained the reason for his failure to notify. The extent of the Appellant’s co–operation had been such that, even allowing for the delays caused by his agent, the whole investigation had taken only a little over ten months. That level of co–operation deserved greater than the 70% discount provided by the Respondents.

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