It has been pretty well established in recent years that where an error has arisen in connection with a taxpayer’s affairs but the taxpayer has relied on the advice of a professional adviser, this does not represent negligence on the part of the taxpayer. The case of Rowland SpC 548 sets out the position clearly and this is supported by the HMRC Manuals.

In the recent case of Waseem Shakoor v HMRC TC 2208, the Tribunal confirmed the general principle that if the advice of a professional is negligently provided, that negligence is not to be imputed to the taxpayer. The question is whether the taxpayer was negligent. He cannot be principally or vicariously liable for the negligence of his professional adviser.

However, there are limits – this is not a get out of jail free card.

InWaseem Shakoor, the issue involved the sale of a property which the taxpayer treated as exempt on the advice of his accountant. The Tribunal considered that the advice by the accountant was so obviously wrong that the taxpayer ought to have called for further explanation. It defied belief that he did not seek an explanation from his accountant to enquire why, or on what basis any exemption could be claimed. The Tribunal suggested that Mr Shakoor shut his eyes to what was or what ought reasonably to have been seen as incorrect advice and these were not circumstances in which he could therefore claim any protection.