Tax investigators are to target people who have sold properties that are not their main homes and have not informed HM Revenue and Customs (HMRC) about any profit made.
The Property Sales Campaign, which HMRC launched on 5th March, is aimed at people selling homes in the UK or abroad, where capital gains tax (CGT) should be paid on any profits made. Properties involved could include holiday homes or homes that have been given to the people selling them.
People now have until 9th August to tell HMRC about any unpaid tax on property sales and until 6th September to pay the tax owed. Those who come forward voluntarily will receive the best possible terms for resolving their tax issues with HMRC as any penalty levied will be lower than if HMRC has to investigate their tax affairs.
HMRC said that after 6th September, it would look much more closely at people who have sold properties other than their main home but who appear to have paid no CGT.
Marian Wilson, head of HMRC Campaigns, said: “Some people will not understand that selling a second home, a holiday home or a property disposed of as a gift could attract capital gains tax.
“It is better to come to us before we come to you. After the opportunity closes on 6 September, HMRC will use information it holds about property sales, in the UK and abroad, to identify people who have not paid what they owe. Penalties – or even criminal prosecution – could follow.”
For more advice and information, read the buy to let tax checklist by Nicholsons.