27th
Mar 2013
HM Revenue & Customs (HMRC) has been accused of being extremely ‘scary and aggressive’ in its heavy handed attempts to target landlords indiscriminately.
Because of information gleaned from Councils, domestic landlords are now receiving letters from the HMRC to find out if they are evading paying tax on rental income.
In the correspondence they are being told to supply information on letting addresses, the period of the lettings, property addresses, how many tenants reside in their rented properties. Besides supplying all of this information, Landlords also have to let them know the details of their weekly and monthly rents.
It just does not stop there, even personal questions are asked about how their rental property was acquired i.e.whether it had been purchased, inherited and gifted.
Although it is in HMRC’s remit to find landlords who are not paying the tax, it is sending out letters to landlords before checking out whether they do actually declare their rent.
Mike Down, head of tax risk and investigation management for a leading accountancy practice says:
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‘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.’
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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.
PIMS Landlords Tax Guide Whilst PIMS cannot provide advice on Tax Issues our Accountants Neil Hooton Accoutancy Services 07568 342752 have produced the following guide to help Landlords with their Tax Return - see Landlords Tax Guide
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