HMRC’s let property campaign

Paying tax debts
What is happening?

HMRC are using their Connect data analysis system to check:

  • Land Registry property ownership details,
  • Companies House records and
  • the tax returns which have been submitted to them by the property owners.

They are checking to ensure that the correct rental income and capital gains arising, have been disclosed and returned to them by the property owners.

The Connect system will automatically highlight any inconsistencies arising from its analysis, for example:

  • Property ownership changes and the capital gains returns by the property owner.
  • Multiple properties held by an individual and insufficient or no rental income declared on their annual tax returns.

What will HMRC do?

HMRC will launch a detailed tax investigation into any undeclared capital gains or rental income and the wider tax affairs of the individual. HMRC’s powers allow them to look back six, and in the case of deliberate tax failures 20 years. Penalties will also be charged on any additional tax arising. Between 15 and 70% of the additional tax arising, dependent on the circumstances.

What should I do?

To reduce the extent of a HMRC enquiry and to minimise any penalty that may be payable a voluntary disclosure is needed at the earliest opportunity. This can be done through HMRC’s let property disclosure facility.

Act now

Get in touch with us and we can assist you in reviewing your tax position in respect of the properties that you own and as necessary make any tax disclosure required for you to get the best results.

 

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