Kearney v Revenue and Customs (CAPITAL GAINS TAX - whether individual resident in the UK during the relevant period on common law (pre-Finance Act 2013) principles) [2026] UKFTT 125 (TC) (14 January 2026)

Parties

Procedural Posture

Tax Appeal / First Tier Tribunal (tax Chamber) Judgment

Legal Issues

1. 1 Whether Mr Kearney was UK resident during the relevant period under common law (pre-Finance Act 2013) principles
2. 2 Whether HMRC made valid discovery assessments under section 29(1) Taxes Management Act 1970
3. 3 Whether Mr Kearney was negligent/careless in submitting self-assessment returns

Ratio Decidendi

Mr Kearney was UK resident during the relevant period under common law principles, as he did not effect a distinct break from the UK in his pattern of life, retained significant business and personal ties, and had available accommodation. HMRC's discovery assessments were validly made under section 29(1) TMA 1970, as there was sufficient evidence of loss of tax due to Mr Kearney's negligent/careless conduct in submitting incorrect self-assessment returns. The negligence/carelessness led to a loss of tax, justifying the imposition of penalties, though quantum was subject to reduction.

Court Disposition

Appeals against tax assessments dismissed; appeals against penalties dismissed subject to reductions in quantum

Orders

• Tax assessments for the relevant years upheld
• Penalties upheld subject to reductions in amount as determined by the Tribunal