Posted by Nick Turpin on 21 Mar 2013
HM Revenue & Customs (HMRC) have announced a new campaign to allow individuals who have sold property, either in the UK or abroad, and who have not told HMRC about it, to bring their tax affairs up to date.
Such individuals may be liable to capital gains tax, and those expected to be affected by the campaign are:-
- Individuals who sold their main residence where “principal private residence relief“ does not exempt the whole gain (eg people who were absent from their homes for significant periods, or people who used part of their home for a business purpose)
- Buy to let landlords
- Second home owners
- Individuals who have gifted a property (eg to a relative other than their spouse/civil partner)
The campaign does not apply to individuals who buy and sell properties on a commercial basis, as they are liable to income tax rather than capital gains tax on any profits. Nor is the campaign suitable for companies, trusts or partnerships who have disposed of a property.
If you are eligible to take part you must also tell HMRC about any other income or gains which you haven’t previously disclosed, such as rental income, income from self-employment, untaxed investment income etc.
To enjoy the best possible terms, individuals must notify HMRC by 9 August 2013 that they will be submitting a disclosure, and must declare any gains and pay the tax owed by 6 September 2013. As with similar HMRC campaigns, those who come forward voluntarily will pay a lower penalty.
HMRC have said that after 6 September 2013, in the absence of a disclosure, it is their intention to use the information they hold about property sales, both in the UK and abroad, to identify people who have not paid the appropriate capital gains tax. These individuals will face higher penalties and also possible criminal prosecution.
We have extensive experience in our team of managing HMRC disclosures, involving both UK and foreign sited income and gains. If engaged we will ensure you pay no more than you need to in terms of tax and penalties.
If you would like any advice regarding the above article or would simply like to discuss other ways in which we could help you or your business, please contact us on 01962 856 990 or firstname.lastname@example.org
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