Mega Posted March 18, 2010 Report Share Posted March 18, 2010 Rummored for awhile:- http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article7066426.ece My guess is that AFTER the vote they suddenly come on strong. Mike Quote Link to post Share on other sites
200p Posted March 18, 2010 Report Share Posted March 18, 2010 HMRC is also pursuing taxpayers who have bought and sold a number of properties over a relatively short period. It claims that in some cases people who regularly carry out this type of activity are engaged in a trade and are therefore liable to income tax and national insurance. Mr Davies said: “Taxpayers who buy, renovate and sell properties without letting them could be considered property developers. Any gains would be taxable as income. The difference between CGT and income tax would mean a massive increase in the amount of tax they would have to pay. --- Or maybe tax staff fearing for their jobs simply want to show that they are worth retaining. Go get rex! This will be fun Quote Link to post Share on other sites
moonriver Posted March 18, 2010 Report Share Posted March 18, 2010 I think your guess will be correct Mike. And about time too. HMRC is also pursuing taxpayers who have bought and sold a number of properties over a relatively short period. It claims that in some cases people who regularly carry out this type of activity are engaged in a trade and are therefore liable to income tax and national insurance. Sounds like this article could be describing many of those happy "property developers" we have seen constantly over the years on "Homes Under the Hammer". I think those smiles they had when the presenters told them how much money they had made from their little ventures, could well be falling from their faces if that letter from the tax office lands on their mats. Quote Link to post Share on other sites
robo1968 Posted March 18, 2010 Report Share Posted March 18, 2010 I think your guess will be correct Mike. And about time too. Sounds like this article could be describing many of those happy "property developers" we have seen constantly over the years on "Homes Under the Hammer". I think those smiles they had when the presenters told them how much money they had made from their little ventures, could well be falling from their faces if that letter from the tax office lands on their mats. 28,000 Doctors.... aren't they supposed to be fixing people? not becoming property magnates Quote Link to post Share on other sites
macca Posted March 18, 2010 Report Share Posted March 18, 2010 And MP's would want this? Quote Link to post Share on other sites
Saving For a Space Ship Posted March 18, 2010 Report Share Posted March 18, 2010 (edited) On a related note, I've seen this on the ebay.co.uk powersellers forum: "For all of those of you who agonise about people you suspect are not registered for tax, this may interest you. HMRC have started a new way of attacking tax evasion. A couple of years back, they managed to get information about Channel Island bank account holders' names, and they announced that people had two options: 1. Contact HMRC first disclose the income, pay the tax, and only suffer a 10% penalty. 2. Don't contact HMRC, and expect an enquiry going back 6 years, or possibly 20 years, and expect penalties up to 100% of the tax evaded. (Its also worth noting that an employee at a Lichtenstein bank copied a load of customers' names onto a CD and sold copies of it to the German tax office and also HMRC - this resulted in death threats to the employee and whooping and hollering in the HMRC HQ) This was a very successful approach, and now HMRC are doing it again. This time, they're going after Doctors who haven't declared some referral fees. I don't think it will be too long before they try it with eBay sellers. Its a very effective way of collecting tax, by simply attacking one industry, putting 'the frightners' on the subjects. It means that 90% of people will contact HMRC first in order to avoid punitive penalties and interest. Its very efficient from HMRC's point of view as they don't need to tie up expensive Inspectors, but can allow much cheaper clerks to deal with it." Edited March 18, 2010 by Saving For a Space Ship Quote Link to post Share on other sites
Sour Mash Posted March 18, 2010 Report Share Posted March 18, 2010 Rummored for awhile:- http://business.timesonline.co.uk/tol/business/industry_sectors/banking_and_finance/article7066426.ece My guess is that AFTER the vote they suddenly come on strong. Mike Inevitable really. Once you own property or get into the game of buying, renting and selling properties, you are a massive, stationary target for government. They may have been prepared to turn a blind eye or put it on the backburner during the boom (with record tax revenues coming in anyway) but now we are in a tax drought and desperate for money (having given it all to the bankers) they will shakedown the punters for every last penny ... retroactively if necessary. People often forget that tax authorities are playing the long game and can more or less make up the rules as they go along. As you say, not until after the election though. Quote Link to post Share on other sites
the end is a bit nigher Posted March 18, 2010 Report Share Posted March 18, 2010 And hopefully the Government will follow the Irish lead and start withdrawing the taxbreak of offsetting income against interest payments for non-company BTLers. Quote Link to post Share on other sites
xux42 Posted March 18, 2010 Report Share Posted March 18, 2010 Inevitable really. Once you own property or get into the game of buying, renting and selling properties, you are a massive, stationary target for government. I can understand widespread ignorance/denial that trading in property (you live in) is a business, but what kind of freak thinks they can rent out a house without declaring the income? Quote Link to post Share on other sites
lets get it right Posted March 18, 2010 Report Share Posted March 18, 2010 But, of course, buying a second property, doing it up, declaring it as your main residence, selling it, and then going back to your previous main residence is most definitely not an activity that gives rise to a claim from HMRC for capital gains tax. Ask any MP. Ask Kitty Usher, Treasury minister. She did it and was on the box last night saying she just did what she is allowed to do. Quote Link to post Share on other sites
skomer Posted March 18, 2010 Report Share Posted March 18, 2010 On a related note, I've seen this on the ebay.co.uk powersellers forum: "For all of those of you who agonise about people you suspect are not registered for tax, this may interest you. HMRC have started a new way of attacking tax evasion. A couple of years back, they managed to get information about Channel Island bank account holders' names, and they announced that people had two options: 1. Contact HMRC first disclose the income, pay the tax, and only suffer a 10% penalty. 2. Don't contact HMRC, and expect an enquiry going back 6 years, or possibly 20 years, and expect penalties up to 100% of the tax evaded. (Its also worth noting that an employee at a Lichtenstein bank copied a load of customers' names onto a CD and sold copies of it to the German tax office and also HMRC - this resulted in death threats to the employee and whooping and hollering in the HMRC HQ) This was a very successful approach, and now HMRC are doing it again. This time, they're going after Doctors who haven't declared some referral fees. I don't think it will be too long before they try it with eBay sellers. Its a very effective way of collecting tax, by simply attacking one industry, putting 'the frightners' on the subjects. It means that 90% of people will contact HMRC first in order to avoid punitive penalties and interest. Its very efficient from HMRC's point of view as they don't need to tie up expensive Inspectors, but can allow much cheaper clerks to deal with it." Recently an employee at UBS copied onto a CD a list of Swiss Bank Account holders and their holdings - he reportedly sold it to the French tax office for 2million Euro. The French authorities reckon they will be making an easy 200million EURO in back taxes from people evading French taxes. No doubt the French authorities will be passing it on to their European partners Would be interesting to know how the HMRC can data mine the Land Registry database to spot professional house flippers? Do they just use surnames? Over the past 5 years it has been a common sight where i live to see professional "property developers" doing up a property (cheap and nasty loft conversions etc) then selling on after up after 4/6 months making 40/50K in the process. Often they have other part time jobs or are semi-retired baby boomers but i doubt they are known to HMRC as serial "property developers" thus avoiding taxes on the main source of their income. Quote Link to post Share on other sites
Si1 Posted March 18, 2010 Report Share Posted March 18, 2010 (edited) Would be interesting to know how the HMRC can data mine the Land Registry database to spot professional house flippers? Do they just use surnames? same way credit checking agencies operate - surname, first name/initial, address, electoral register, even change of address details on credit agency DB derived from bank details. If you have the right access to other data this should be pretty easy if somewhat labourious. the land registry database is a big freebie to make this double-easy, and they probably have access to your bank records too, to see who ACTUALLY paid for what... Edited March 18, 2010 by Si1 Quote Link to post Share on other sites
lulu Posted March 18, 2010 Report Share Posted March 18, 2010 I can understand widespread ignorance/denial that trading in property (you live in) is a business, but what kind of freak thinks they can rent out a house without declaring the income? Quite a number I suspect, I lived in one flat where the LL always tried to get me to pay in cash but I refused on the grounds of not wanting to carry large amounts of cash around but that was almost certainly part of a scam to avoid money actually going into their account. I insisted on paying by cheque so at least there is a record of money changing hands if they are ever checked up on. Quote Link to post Share on other sites
Si1 Posted March 18, 2010 Report Share Posted March 18, 2010 Quite a number I suspect, I lived in one flat where the LL always tried to get me to pay in cash but I refused on the grounds of not wanting to carry large amounts of cash around but that was almost certainly part of a scam to avoid money actually going into their account. I insisted on paying by cheque so at least there is a record of money changing hands if they are ever checked up on. Agreed - I'm sure it is rife. It is less justice the HMRC are after than easy money. Fish in a barrel. I moved into a HMO once and informed the council, who promptly added me to the list of council tax payers at the house I was moving to. Only the LL's name was on there, despite 3 other people living in the house. He was really upset with me for losing him his single person's council tax allowance! and even went so far as to get me to sign a letter saying I was moving somewhere else to get me off his bill. Characters like that don't make good landlords as they are equally likely to scam their tennants. Quote Link to post Share on other sites
Sour Mash Posted March 18, 2010 Report Share Posted March 18, 2010 I can understand widespread ignorance/denial that trading in property (you live in) is a business, but what kind of freak thinks they can rent out a house without declaring the income? Lots of amateur BTLers are doing just that - especially the 'accidental' ones who maybe got married or inherited a house thus leaving one spare. Often they have a standard residential mortgage on the property too, not a BTL mortgage, which means they are obtaining a pecuniary advantage by deception (i.e. open to charges of fraud) as well as evading taxes. Quote Link to post Share on other sites
Democorruptcy Posted March 18, 2010 Report Share Posted March 18, 2010 28,000 Doctors.... aren't they supposed to be fixing people? not becoming property magnates That was before their salaries exploded upwards in 2004/2005. They need something to do with all that extra money don't they? Whiteaway Laidlaw, a subsidiary of Manchester Building Society, which entered the buy-to-let market for the first time six months ago, and whose typical borrower is a GP with two or three buy-to-let properties, said that it was targeting high-earning landlords rather than first-time buyers because they were less likely to default. http://www.timesonline.co.uk/tol/money/property_and_mortgages/article6993169.ece Quote Link to post Share on other sites
nohpc Posted March 18, 2010 Report Share Posted March 18, 2010 And hopefully the Government will follow the Irish lead and start withdrawing the taxbreak of offsetting income against interest payments for non-company BTLers. How wold this make a difference. Just set up a company such as nohpc plc and do your BTL expenses through the company. Easy. Quote Link to post Share on other sites
porca misèria Posted March 18, 2010 Report Share Posted March 18, 2010 But will anyone get done for fraud for having a residential mortgage on a BTL - accidental LL or not. Tax evasion on the rental yes but the fraud part I cant see. The bank or building society should pursue as a BTL mortgage is more expensive but will they? Haven't we had reports of convictions here? It's material, because it complicates the lender's ability to realise the asset in the event of default. Quote Link to post Share on other sites
Si1 Posted March 18, 2010 Report Share Posted March 18, 2010 That was before their salaries exploded upwards in 2004/2005. They need something to do with all that extra money don't they? I thought it was before then - or did they get payrises in stages? Quote Link to post Share on other sites
moonriver Posted March 18, 2010 Report Share Posted March 18, 2010 That tax man really is getting desperate to get his dosh coming in... he is after the Weight Watchers now too... http://www.qdosconsulting.com/qdosmain.asp?file=1q35llnqjmq0Weight Watchers Dramatic Loss of Pounds Weight Watchers (UK) Ltd (WW) are facing a tax bill of £23M after losing its appeal against HMRC’s re-classification of Leaders as employees during the period April 2001 – April 2007, at the First Tier Tax Tribunal. WW Leaders run the weekly meetings that take place in Britain which can reach as many as 6,000 in any one week. Those meetings involve thousands of individual members. All Leaders were engaged on a self-employed basis and were given WW ‘Self-employment and income tax booklet’. This highlighted the position of the self-employed with regard to income tax and NICs and that Leaders did not receive any company benefits. It also stated, however, that all workers were entitled to receive holiday pay and there was evidence that this was actually paid! ....... ...... It is expected that, with such a considerable amount of tax at stake, WW will appeal this decision." Quote Link to post Share on other sites
Democorruptcy Posted March 19, 2010 Report Share Posted March 19, 2010 I thought it was before then - or did they get payrises in stages? 2005 was the start with a lovely 30% when the new contracts started GPs earned an average £106,000 during the first year of their new contract, figures show. Figures from the Information Centre for health and social care show average earnings rose by 30% during 2004-05 http://news.bbc.co.uk/1/hi/health/6157219.stm Then by 2008 some of them have gone berserk Family doctors are earning up to £380,000 a year, a Daily Mail investigation has revealed. GPs take home 'jaw-dropping' sums thanks to bonuses and overtime payments. They are being paid more than £200 an hour for evenings and weekends - work they did for free before the bungled introduction of a new contract in 2004. Six years ago GPs were paid around £70,000. http://www.dailymail.co.uk/news/article-1204065/The-GP-earning-380-000-year--hours-doctors-200-hour.html All that money on wages and now they are talking about a £30k death tax to look after old age people. Quote Link to post Share on other sites
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