HMRC crackdown on buy-to-let tax dodgers

Permalink: HMRC crackdown on buy-to-let tax dodgers
by Gill Montia

Accountancy firm, Wilkins Kennedy, has warned that HM Revenue & Customs (HMRC) has begun a long-awaited investigation into buy-to-let investors.

HMRC is in the process of sending out letters to individuals it believes own buy-to-let properties and have failed to declare their investments in their self-assessment returns.

The letters are reported to ask for details of property investment activity over the past six years and request a detailed breakdown of costs, such as repairs and professional fees.

According to Wilkins Kennedy, HMRC has been compiling its list of landlords from lettings agencies over a number of years, but a concerted compliance campaign has only just begun.

Peter Goodman, Senior Tax Partner, of Wilkins Kennedy says: “There has often been speculation that HMRC would start a compliance drive against landlords but up until now enquiries have been pretty piecemeal. This is a real change in tactics for HMRC.”

Adding: “Individuals who receive these letters need to take them seriously. If they do owe tax they should consider early disclosure as part of a negotiated settlement. This may reduce the penalties they incur. People who refuse to cooperate with HMRC on this could ultimately face criminal prosecution.”