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HMRC target the sale of second homes

HMRC have launched a new campaign to target people who have sold properties which are not their main homes and who have not disclosed the profit made.

The Property Sales Campaign is aimed at those selling homes in the UK or abroad, where Capital Gains Tax (CGT) should be paid on any profits made. This includes holiday homes or properties that have been gifted to people.

HMRC have announced that people have until 09 August 2013 to disclose any unpaid tax on property sales, and until 6 September to pay the tax owed.

After 6 September, HMRC have said they will be looking closely at the tax affairs of those who have sold properties other than their main home, but who appear to have paid no CGT. They have assured that people who come forward voluntarily will receive the best possible terms, as any penalty they pay by coming forward voluntarily will be lower than if HMRC comes to them first.

Marian Wilson, Head of HMRC Campaigns, said: “Some people will not understand that selling a second home, a holiday home or a property disposed of as a gift could attract Capital Gains Tax. They need to look at our website or contact us. Telling HMRC about your tax liabilities is simple and straightforward, and help, advice and support are available.”

“It is better to come to us before we come to you. After the opportunity closes on 6 September, HMRC will use information it holds about property sales, in the UK and abroad, to identify people who have not paid what they owe. Penalties – or even criminal prosecution – could follow.”

Andrew Swan, Head of the Financial Crime Unit at Newcastle-based solicitors Short Richardson & Forth LLP commented: “This campaign is clearly targeted at second or additional properties. People should not be concerned about their main home, as generally this is exempt from Capital Gains Tax.”

“HMRC holds a database for all property disposals attracting Stamp Duty Land Tax. Once the ‘amnesty’ period ends, I understand HMRC will compare the property disposal data with tax records to establish whether people have told HMRC about the sale or disposal of second properties. Given the recent high targets set for tax prosecutions, I would not be surprised to see subsequent criminal proceedings.”

This was posted in Bdaily's Members' News section by Andrew Swan .