A Holmfirth based firm of accountants is urging people to be prepared for a review into residential property sales. V&A Bell Brown also warns that the process may be a “bureaucratic nightmare”, and that anyone involved should be prepared for the eventuality of tax miscalculations.
The Property Sales Campaign (PRC) will see HM Revenue and Customs reviewing the tax records of those who have sold residential properties but not reported them in order to collect tax on undeclared gains.
“From September HMRC will be reviewing tax records of anyone who has sold a property and has not declared any taxable gains, since at least April 2007.
“It is understood that the tax authority will use National Insurance numbers on Stamp Duty Land Tax (SDLT) forms to tie these in with income tax records of individuals. In view of my regular dealings with HMRC, I would urge anyone to be ready for potential miscalculations and then having to claim money back from HMRC, which is not going to be an ideal situation by any means.”
“While the campaign is primarily focusing on second homes, HMRC also plans to investigate sales of properties which could have been used for reasons other than residential accommodation, for example where a claim has been made for a tax deduction running a business from home.”
People who come forward by August 9 and calculate and pay the tax due by September 6 may receive preferential treatment.
Those who sold property on or after 6 April 2012 should also not face scrutiny, as they have until 31 January 2014 to declare any taxable gains.