Bentley v HMRC

Follower notice penalties

In Bentley v HMRC [2021] UKFTT 5 (TC) (8 January 2021) the First-tier Tribunal (FTT) upheld three penalties for failure to take corrective action required by follower notices but reduced the amount of the penalties from 42% to 24% of the tax advantage denied under the notices.

The appellant had entered into a marketed ‘IR35 arrangement’ designed to mitigate his income tax and NICs liability and applied it for the three years 2006/07 to 2008/09. Following the decision in Huitson v HMRC [2015] UKFTT 488 (TC) HMRC issued accelerated payment notices and follower notices to the appellant for all three years. The follower notices required that he take the necessary corrective action by 7 February 2017; this deadline was extended to 27 April 2017 after the appellant made representations against the notices. He did not take corrective action until April 2019 and HMRC issued penalties....