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HMRC internal manual

Inheritance Tax Manual

Negligence: what is negligence?

There is no statutory definition of negligence.

The Concise Oxford Dictionary defines negligence as ‘want of proper care andattention’ and ‘(piece of) carelessness’.

In the context of the Taxes Management Act 1970, negligence has been stated as a‘careless breach of duty’, Regina v General Commissioners of Income Tax forHavering (ex parte Knight) 49 TC 161, p 175. Applying this definition, there are twoquestions that have to be answered

  • First, did the taxpayer owe HMRC a duty?
  • Secondly, was the taxpayer careless?

Under the law of tort negligence has been defined as ‘…. the omission to dosomething which a prudent and reasonable man would do’ (Baron Alderson in Blyth vBirmingham Waterworks Co, 1856, 11 Ex 781, p 784).

We can assume that in an IHT context a reasonable person would, amongst other things

  • comply with the requirements of the law by, for example, making the fullest enquiries reasonably practicable to identify all property forming part of the deceased’s estate and the open market value of the property
  • deliver a correct and complete account within the time allowed
  • read carefully an account or form and any accompanying guidance notes
  • check the contents of an account completed by an agent before signing it
  • seek professional help with matters such as valuations, which they are unable to cope with satisfactorily themselves.

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)