FTT Refuses Late SDLT Appeal Where Appellants Chose Not to Seek Professional Advice

In R & E Goonesena v Revenue and Customs, the First-tier Tribunal (FTT) highlighted that the appellants’ decision not to seek professional advice, being a conscious choice, did not justify permission for a late appeal against a Stamp Duty Land Tax (SDLT) discovery assessment. The case underscores the importance of statutory time limits and the FTT’s reluctance to extend them without a compelling justification.

The appellants initially filed an SDLT return for the transaction, reporting an SDLT liability of £1,386. Two months later, HMRC issued a discovery assessment for an additional SDLT amount of £33,613.12 on the grounds that the original return had been underpaid. Although the standard timeframe to appeal such an assessment is 30 days, the appellants delayed their appeal by 164 days (equivalent to 5 months and 11 days). As the deadline had already passed, they subsequently submitted an application to the FTT seeking permission to appeal out of time.

While the FTT has discretion to allow an application for a late appeal against an SDLT discovery assessment, the Upper Tribunal, in Martland v HMRC [2018] UKUT 178 (TCC), has set out the principles and guidelines for exercising that discretion. In rejecting the application, the FTT applied the three-stage test established by Martland, determining that the delay was both "serious and significant". It held:

"It cannot be right that a delay which is significant and for which there was no good reason should be overlooked simply because the amount at stake is very large."

The reason for the delay by the appellants was a “conscious decision” not to appeal, based on their belief (without advice) that their case was unlikely to succeed, for which they must bear the consequences.

For taxpayers, this case underscores the critical importance of adhering to statutory time limits and seeking professional advice when facing tax assessments.

Read the full decision of R & E Goonesena v Revenue and Customs [2024] UKFTT 619 (TC) here.