PAUL HOGARTH LIFE INTEREST TRUST 2008V
The appellants were trustees of a life interest trust, the income of which was mandated to the life tenant and passed directly to him. HMRC served a notice under s8A of the Taxes Management Act 1970 to file an income tax return on the trustees. When no return was filed, HMRC assessed penalties against the trustees for failure to file the return by the due date. The trustees appealed to the First-Tier Tribunal against the decision of HMRC to reject their appeals, arguing that they thought a return had been filed by their previous agents, that given that the return was a nil return (since none of the trust’s income was received by the trustees) a penalty of £1300 was unduly severe, that the trustees had no income to pay the penalty.