Launched in Autumn 2013, the Let Property Campaign provides buy-to-let and other private landlords an opportunity to make a full and voluntary disclosure on very favourable terms.
In 2014, around 40,000 landlords who failed to come forward voluntarily were sent a 'promoted disclosure' letter, providing a 30 day window to make contact and regularise their tax affairs, however would not receive the same favourable conditions as an 'unprompted disclosure?.
Those who ignored the letter risk penalties of up to 100% of the unpaid liabilities (or up to 200% for offshore related income), investigation under Code of Practice 8/9 and in certain cases criminal prosecutions.
According to accountants www.jeffreyshenry.com many buy-to-let and accidental landlords have under declared rental profits having misunderstood the rules. The most common misconception is that landlords believe all of the mortgage repayments can be offset however it's only the interest proportion.
With increased data gathering actives, it is less likely a case of if, and more likely when, HMRC catches up with you. Landlords with undeclared or under disclosed rental income who have not yet been contacted by HMRC and want to regularise their affairs should do so as soon as possible. Very favourable terms and affordable repayment plans can often be negotiated.
HMRC announced recently that two men have been arrested on suspicion of a £1 million Capital Gains Tax and Income Tax fraud during dawn raids by HM Revenue and Customs (HMRC).
Officers arrested one man from London, aged 51, and one man from Ilford, Essex, aged 54. They searched two residential properties one in London E12, and one in Ilford and have so far seized business records and cash.
It is believed the pair failed to declare Capital Gains Tax on numerous properties they bought and sold.
Alan Tully, Assistant Director, Criminal Investigation, HMRC, said:
?We are investigating what we suspect is a large-scale, organised tax fraud to steal £1 million of taxpayers' money. Today?s operation is part of a HMRC property taskforce campaign to clamp down on those believed to be dodging Capital Gains Tax. It sends out a clear message – we will relentlessly pursue those believed to be involved in fraud.
?Anyone with information about tax fraud should contact the Tax Evasion Hotline number on 0800 788 887.?
Both men are currently being questioned under caution by HMRC officers. They were arrested on suspicion of offences under the Fraud Act and Cheating the Public Revenue.
Taskforces bring together various HMRC compliance and enforcement teams for intensive bursts of activity targeted at specific sectors and locations where there is evidence of high risk of tax evasion and fraud. The teams visit traders to examine their records and carry out other investigations.
Article courtesy of LandlordZONE