Revenue Targets Buy to Letters
HM Revenue & Customs’ campaign of compliance checks into property income, announced last month, appears to have begun in earnest. We have been told of a number of people who have received letters from the Revenue.
At first glance the letters look innocuous; a straight forward enquiry, asking whether tax returns might have omitted rental income in error.
It would be wrong to underestimate the gravity of these letters on a number of grounds, including:
- in our experience, the Revenue will have done their homework. Though they may have made mistakes in compiling their lists, shaking them from their belief that their information is perfect will not be easy; and
- though their letter may not look threatening, they will undoubtedly be treating this as a serious issue. In addition to collecting the tax due (and interest where it has been paid late), the Revenue will look to apply penalties, which could theoretically double the tax payable.
Finding information relating to rental income, interest payments and other expenditure from a number of years ago will be a difficult task; without it – and the goodwill of the Revenue – the amounts payable could escalate.
If this is an issue potentially of concern to you, please contact Cathy Corns or me. We have helped a large number of clients in dealing with Revenue enquiries and might be able to provide practical and timely advice and assistance.
Date: 18th March, 2008
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