Perils of inconsistency
A recent case, Trevor Anthony Hartland v HMRC, appears to be about whether properties were principal private residences (PPRs), or trading assets.
Ultimately the Tribunal agreed with HMRC that at least one property sale was trading. Interestingly, one of the things HMRC looked at was the difference between the declared profits on the tax returns, and the higher income figures declared on mortgage applications. The Tribunal agreed that the higher income declared suggested that the taxpayer saw the gains from selling the properties as income.
It really pays to be consistent!
Date: 23rd February, 2015
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