View the article online at http://citywire.co.uk/money/article/a659525
Landlords targeted in HMRC tax clamp down
HMRC is demanding landlords hand over details of their properties and tenants even if they have declared rental income.
HM Revenue & Customs (HMRC) has been criticised for its latest ‘scarily aggressive’ crackdown, which sees residential landlords targeted indiscriminately.
The taxman is targeting domestic landlords with information obtained from local councils to try and track down landlords evading tax by failing to declare rental income.
Landlords have received letters from HMRC requesting information on property addresses, letting periods, how many tenants are in the property and details on weekly and monthly rents. More personal questions about how rental property was acquired are also being asked, for example whether it has been purchased, inherited and gifted.
Mike Down, head of tax risk and investigation management at accountants Baker Tilly, said while clamping down on tax evasion was part of HMRC’s remit it is sending out letters to landlords before checking whether they are declaring rent.
‘Clearly it’s good to see HMRC cracking down on tax cheats, but we do have real concerns over what appears to be the non-risk based approach of this campaign,’ he said.
‘What’s even more shocking is that telephone staff at HMRC are openly admitting that the probing letters are being issued without the department having first checked whether the landlord is in fact fully declaring the rents on their annual tax returns.’
Down said that taxpayers who have declared rental income under self-assessment returns are being asked to send out additional information under a formal framework and HMRC is ‘unnecessarily wasting the time of law-abiding taxpayers’, as well as its own resources.
‘Surely it’s time HMRC were more careful with their precious resources and invested time in carefully checking third-party information before sending what might be viewed as scarily aggressive letters to those who are fully tax compliant,’ said Down.
News sponsored by:
After Boris announced he was backing Brexit, sterling suffered its biggest slump in six years. Our Market Mavens discuss. Follow the Market Mavens LinkedIn page for weekly videos, in which our panel of industry experts share their views on financial news
The Citywire guide to investment trusts
In association with Aberdeen Asset Management
More about this:
More from us
- Housing benefit reforms: a huge gamble on rent cuts
- Buy-to-let landlords: expect a tougher 2012
- Small bank could be big deal for buy-to-let lender Paragon
- Buy-to-let at risk as tenants demand to see mortgage permission
Tools from Citywire Money
From the Forums
Weekly email from The Lolly
Get simple, easy ways to make more from your money. Just enter your email address below
An error occured while subscribing your email. Please try again later.
Thank you for registering for your weekly newsletter from The Lolly.
Keep an eye out for us in your inbox, and please add email@example.com to your safe senders list so we don't get junked.
by David Kempton on May 24, 2016 at 17:15