HMRC enquiries into capital gains tax boosts take 43%
The taxman gleaned a 43% higher yield in capital gains tax in 2011 than 2010
A CRACKDOWN by the taxman last year yielded a 43% higher capital gains tax yield than the previous year.
HM Revenue & Customs investigations into underpaid capital gains tax brought in £105.2m in 2011, up from £73.6m in 2010.
The investigations formed part of a wider crackdown on buy-to-let investors, with the launch of a taskforce to specifically look into the tax affairs of landlords in north-west England and north Wales.
Roy Maugham, tax partner at UHY Hacker Young, said both the coalition government and the previous Labour government had significantly altered the capital gains tax legislation.
He said: “Some major changes to capital gains tax which have pushed up the cost of this tax to entrepreneurs, other business owners and buy-to-let investors. When you get big increases in tax, this is inevitably accompanied by big increases in tax planning.”
He added that the abolition of taper relief in 2008 – which reduced the amount of capital gains tax that was payable on the sale of an asset – would have been a strong motivation for tax avoidance and this was now feeding through to the higher HMRC tax take through investigations.