The taxpayer has lost her appeal in a case where numerous cases she quoted appeared to have been invented, possibly by ChatGPT, and where there was no reasonable excuse – Harber v HMRC  UKFTT 1007 (TC).
The taxpayer quoted four successful FTT appeals involving ignorance of the law, and five successful FTT cases involving mental health issues, details of which had been provided to her by “a friend in a solicitor’s office”.
After reviewing the evidence, the FTT found as a fact that “the cases in the Response are not genuine FTT judgments but have been generated by an AI system such as ChatGPT” (but also that the taxpayer was unaware that they had been fabricated).
On the substantive point, the FTT concluded that a reasonable taxpayer, who had previously obtained advice from HMRC, and who knew she had made a capital gain, would have contacted HMRC, Tax Aid, an accountant or a lawyer to find out what she needed to do. That hypothetical reasonable person would not simply have put some money away and waited for HMRC to make contact.
In coming to that finding the FTT took into account the fact that the taxpayer suffered from anxiety and panic attacks. However, this did not prevent her from putting Sunderstead Road on the market; liaising with her solicitors; dealing with the sale, calculating the gain or dealing with her lodgers; it also did not prevent her from contacting HMRC, Tax Aid, a lawyer or an accountant to find out what law applied to the reporting of her capital gain.
The taxpayer’s ignorance of the requirement to notify her liability was not objectively reasonable.
For all of these reasons, the appeal was dismissed.
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Written for accountants and other tax advisers at an intermediate level, Capital Gains Tax is built firmly on a foundation of statutory rules and case law principles. It is illustrated throughout with practical examples, and most chapters include a summary of pitfalls and planning points.