Here we are again with some UK property-related news and views for you…
A new HMRC taskforce has been set up in North-West England and North
Wales to target those who have sold one or more properties and have not
declared rental income or paid any Capital Gains Tax that’s due.
HMRC’s Jennie Granger, Director General of Enforcement and Compliance,
says, ‘HMRC taskforces are deployed in sectors and areas where we’ve
detected a high risk of tax evasion. For example, in a previous
property taskforce in London in 2013 we uncovered a barrister who had
evaded £471,512 in unreturned capital gains.’
‘The people being targeted by our taskforces have no intention of
playing by the rules and could end up facing a heavy fine or even a
criminal conviction. A Hertfordshire property consultant who failed to
declare or pay Capital Gains Tax and rental income on a number of
properties was uncovered by an HMRC taskforce in 2013 and, as well as
paying the tax and interest due, now has a criminal record. If you
haven’t declared all your income, we will find you and investigate.’
Just so you know.
In the run up to the EU Mortgage Credit Directive coming in during
2016, there is talk that ‘accidental landlords’ -those who rent their
old homes – will face regulation. Have to say that this is a vague
heads-up at this stage but that we will have more shortly on this and
other upcoming EU legislation and how it may impact on investors.
Paul Smee at The Council of Mortgage Lenders says, ‘With the Mortgage
Market Review out of the way, we now enter round two of regulatory
change as a result of the European Mortgage Directive. We are hopeful
that most of the impact should be modest, as much of it was anticipated
and helpfully built in to the new rules in the first place.’
‘It is frustrating though that, despite earlier assurances, the
buy-to-let position turns out not to have been adequately resolved,
resulting in a new proposal for regulating part of the buy-to-let
mortgage market. The regulatory regime now being proposed is based not
on any evidence of a need for additional consumer protection, but
purely on ensuring that the European legal requirements are met.’ More
Tell The Taxman
Worcestershire accountants Ormerod Rutter have issued a note of warning
to property investors. They note that ‘fewer than 500,000 taxpayers are
registered with the tax authorities as owning a second property yet the
real number could be as high as 1.4 million’.
‘HMRC are being very proactive, approaching letting agents for lists of
landlords and cross-checking taxpayers’ records with Land Registry
information, and if any tax is due the penalties can be severe.
However, it’s also worth considering that if your property has made a
loss, then that can be offset against future profits. Landlords who
have not yet declared their income are welcome to contact us and there
is also plenty of useful information on the HMRC website. More to
follow? You tell us. We have some material coming in.