Hundreds targeted in buy-to-let probe
HMRC is questioning hundreds of buy-to-let investors about undeclared income
HM Revenue &
Customs has posted 500 letters and could send out 1,500 more in a probe
targeting property owners who may have failed to declare their investments.
If ievidence of fraud is uncoivered, HMRC can demand tax, interest and
penalties as far back as 20 years.
‘I have information that suggests you have received rent from property but
have not included it in your tax return. I need to check with you if my
information is correct and, if you have received rents, to work out any tax that
may be due,’ the letter says.
The Financial Times reports HMRC plans to evaluate the results of
the letters before issuing more over the next few months to taxpayers and their
agents. Tax advisers said letting agents and stamp duty land tax returns were
likely sources of the HMRC’s information about landlords.
Peter Goodman, of Wilkins
Kennedy, said rising rents meant even highly-geared investors might be
making a taxable profit from their investments.
The investigation was also expected to identify unpaid capital gains tax on
previous investments and ensure future property sales did not slip off the
radar.
Further reading:
Buy-to-let couples face new tax bill
Taxman furious over buy-to-let row
Read
story in the Financial Times