BTL Tax Evasion - "Project Scare" is starting

[stop_the_craziness]

I remember someone on here speculating that come the autumn there would be a campaign to scare illegal BTLs into thinking twice about not filling in that first Self Assessment Tax form after the changes for S24 came into force in April

Seems like "Project Scare" has started early.  

Article in the FT  - which I don't read, but which was being promoted via the MSN homepage news.

http://www.msn.com/en-gb/money/personalfinance/ten-ways-hmrc-can-tell-if-you’re-a-tax-cheat/ar-BBDVZgL?li=AAmiR2Z&ocid=spartandhp

Section 3 "Ghosts and Moonlighters" - here is an extract

HMRC has long targeted areas where it believes there might be non-compliance.

 Local authorities are increasingly demanding that tenants have their properties licensed in an attempt to address poor property management. That helps HMRC because it creates a searchable public register of people who are renting out properties.

It wants to go further, though, by making registration for tax a condition of acquiring a licence.

[CunningPlan]

 

[Freki]

That could be a nice data science project - using the land registry, predicting which is OO, rented ...

Of course you need other sources, I wish I was more advanced in data science to do such a thing. 

I guess predicting who is a LL by looking at purchasing patterns should be easy enough though.

[Ah-so]

46 minutes ago, Freki said:

That could be a nice data science project - using the land registry, predicting which is OO, rented ...

Of course you need other sources, I wish I was more advanced in data science to do such a thing. 

I guess predicting who is a LL by looking at purchasing patterns should be easy enough though.

Rightmove shares its data in lettings and that can be crossed referenced against the land registry. 

[Tapori]

7 hours ago, stop_the_craziness said:

I remember someone on here speculating that come the autumn there would be a campaign to scare illegal BTLs into thinking twice about not filling in that first Self Assessment Tax form after the changes for S24 came into force in April

Seems like "Project Scare" has started early.  

Article in the FT  - which I don't read, but which was being promoted via the MSN homepage news.

http://www.msn.com/en-gb/money/personalfinance/ten-ways-hmrc-can-tell-if-you’re-a-tax-cheat/ar-BBDVZgL?li=AAmiR2Z&ocid=spartandhp

Section 3 "Ghosts and Moonlighters" - here is an extract

HMRC has long targeted areas where it believes there might be non-compliance.

 Local authorities are increasingly demanding that tenants have their properties licensed in an attempt to address poor property management. That helps HMRC because it creates a searchable public register of people who are renting out properties.

It wants to go further, though, by making registration for tax a condition of acquiring a licence.

Beautiful. Simply beautiful.

Let's see who's been sneaking puddings!

[frankief]

2 hours ago, fru-gal said:

Yet local authorities apparently can't tell who is subletting their social housing properties. Cross referencing LHA claims and housing benefit claims that have the same address or even those that just have LHA claims where the rent is also being paid by the official resident (who is not claiming HB) is apparently too difficult for them to do. 

What about linking it to the Council Tax Dept/ Electoral Roll. The places i've rented have always been badgered by CT letters asking me to confirm who lives there etc.with potential fines for not complying.

Add another tick box - are you owner occuper/ rented etc. Please provide owners and/ or agent's address etc.

Too easy?

[Toast]

1 hour ago, frankief said:

What about linking it to the Council Tax Dept/ Electoral Roll.

I think it's important not to use electoral roll registration for any kind of enforcement for other things: keep that data set isolated. Why? Because citizens should not be disenfranchised, even if they they are leading marginal lives.

[CunningPlan]

58 minutes ago, Toast said:

I think it's important not to use electoral roll registration for any kind of enforcement for other things: keep that data set isolated. Why? Because citizens should not be disenfranchised, even if they they are leading marginal lives.

As a suggestion, how about splitting council tax? If we assumed that (say) 80% of tax raised was spent on services and 20% on improving the area, it could be argued that a tenant benefits from 80% and the owner 20% of the expenditure and should therefore pay accordingly.

The council would find out very quickly which properties are rented on that basis as tenants claim their discounts.

[Toast]

1 minute ago, CunningPlan said:

As a suggestion, how about splitting council tax? If we assumed that (say) 80% of tax raised was spent on services and 20% on improving the area, it could be argued that a tenant benefits from 80% and the owner 20% of the expenditure and should therefore pay accordingly.

The council would find out very quickly which properties are rented on that basis as tenants claim their discounts.

Very clever. I'd need to think more about possible unintended consequences, but at first blush, that sounds perfect.

[Sawitcoming]

7 minutes ago, CunningPlan said:

As a suggestion, how about splitting council tax? If we assumed that (say) 80% of tax raised was spent on services and 20% on improving the area, it could be argued that a tenant benefits from 80% and the owner 20% of the expenditure and should therefore pay accordingly.

The council would find out very quickly which properties are rented on that basis as tenants claim their discounts.

That is a cunning plan.  

[SOLZHENITSYN]

Merton Council have started asking you to specify if you are the owner or a tenant of your property when you fill out your council tax documents.

if you are a tenant then you have to provide the name and address of your landlord. 

[Toast]

55 minutes ago, SOLZHENITSYN said:

Merton Council have started asking you to specify if you are the owner or a tenant of your property when you fill out your council tax documents.

if you are a tenant then you have to provide the name and address of your landlord. 

Actually, I have just moved, and was asked this question too when I registered for council tax online.

[mrtickle]

57 minutes ago, SOLZHENITSYN said:

Merton Council have started asking you to specify if you are the owner or a tenant of your property when you fill out your council tax documents.

if you are a tenant then you have to provide the name and address of your landlord. 

And what if you don't? You go to prison?

 

Edited July 8, 2017 by mrtickle

[interestrateripoff]

Btl sitting ducks for the tax man.

[SOLZHENITSYN]

2 hours ago, mrtickle said:

And what if you don't? You go to prison?

 

I don't get your point? Why wouldn't a tenant provide these details? It's no skin off my nose...

[adarmo]

A land value tax is impossible to evade. 

 

[mrtickle]

42 minutes ago, SOLZHENITSYN said:

I don't get your point? Why wouldn't a tenant provide these details? It's no skin off my nose...

I'm sure a tenant would, but to play devil's advocate: what punishment is available to them in Law if they don't? What legal powers does Merton Council now have, that they didn't before, to compel the tenant to provide those details - the tenant may only have the agent's details, without much/any information of the landlord.

 

Edited July 8, 2017 by mrtickle

[Dorkins]

If only there was some kind of land registry that HMRC could use to track down landlords.

[Odin]

3 hours ago, satch said:

Data protection  data protection data protection willl be the cry from all the landlords, not allowed to give out that information

Data protection does not cover legal requirements and tax collection procedures is usually backed by legal mandate. It covers trying to limit the scope of key elements of data to a need to know basis.  Tax collection forms make it a legitimate need to know.

Just make the penalty for not giving the info forfeiture of the property, since if no one claims it; it must be owned by the crown ?

 

[Odin]

2 hours ago, Dorkins said:

If only there was some kind of land registry that HMRC could use to track down landlords.

Land owner ?   not landlords ?

What name goes down on a leasehold ?  On the land a block of flats stand on ?

Making the act of rent collection licensable and legally reportable to multiple parties.  The receiver needs to disclose (tax return) and the sender needs to disclose

 

[spyguy]

7 hours ago, Dorkins said:

If only there was some kind of land registry that HMRC could use to track down landlords.

They are going big for this. Who'd have thought - not the leveraged loons BTLers, most of which have probably never filled in a tax return, or had to deal with an in irate tax man.

IO BTL is a doddle - the banks have to report wo has the property.

LR registry then gives you a list of owners.

I guess the problem area is where a property is help by an offshore company.

 

[Greg Bowman]

1 hour ago, spyguy said:

They are going big for this. Who'd have thought - not the leveraged loons BTLers, most of which have probably never filled in a tax return, or had to deal with an in irate tax man.

IO BTL is a doddle - the banks have to report wo has the property.

LR registry then gives you a list of owners.

I guess the problem area is where a property is help by an offshore company.

 

The offshore bit will second wave millions of fish in the barrel for them to go at first 

[Greg Bowman]

11 hours ago, satch said:

Data protection  data protection data protection willl be the cry from all the landlords, not allowed to give out that information

They will have to register like any other business which most of them are not 

[Toast]

10 hours ago, mrtickle said:

I'm sure a tenant would, but to play devil's advocate: what punishment is available to them in Law if they don't? What legal powers does Merton Council now have, that they didn't before, to compel the tenant to provide those details - the tenant may only have the agent's details, without much/any information of the landlord.

I had the option to provide the landlord's details, or the agency's details.

 

11 hours ago, SOLZHENITSYN said:

I don't get your point? Why wouldn't a tenant provide these details? It's no skin off my nose...

This is correct: there is little to no need for compulsion, since the tenant loses nothing (not even his/her privacy) by providing the information. Even if you have a bad landlord who asks/tells you not to fill in the information, how will the LL know where the details that ensnared him came from? The tenant has a risk-free and secret way to poke his landlord in the eye if said LL seems to be throwing his weight about.

It is part of the fearful power of integrated data collection from many sources that you can weave, like gleipnir, an unbreakable chain out of the most fragile strands.

 

8 hours ago, Odin said:

Just make the penalty for not giving the info forfeiture of the property, since if no one claims it; it must be owned by the crown ?

I appreciate that because you will come to such an unfortunate end, you want to be doubly sure that the chain will hold - but if the authorities are thoughtful, they can get all the information they need, in the gentlest of manners.

Edited July 9, 2017 by Toast
Accuracy and spelling.

[mrtickle]

2 hours ago, Toast said:

It is part of the fearful power of integrated data collection from many sources that you can weave, like gleipnir, an unbreakable chain out of the most fragile strands.

Great line