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HMRC targets undeclared gains on second homes

printer Mail

People who have sold a property that is not their main home and have failed to declare a capital gain have been invited to sign up to HMRC’s new ‘property sales campaign’.

‘By using this campaign to come forward voluntarily, people will receive the best possible terms, as any penalty they pay by coming forward voluntarily will be lower than if HMRC comes to them first,’ the department said.

Guidance is provided on the HMRC website. A ‘notification’ must be made by 9 August 2013.

‘To take advantage of the best possible terms you must voluntarily disclose your income or gains and pay what you owe by 6 September 2013,’ HMRC said. After that date, HMRC will use its information, including data on property transactions attracting stamp duty land tax, to target ‘those who should have made a disclosure under this campaign and failed to do so’.

The campaign is aimed at people have sold, or otherwise disposed of, second or additional residential properties in the UK or abroad. But it is also available for a gain made on disposal of the main home in circumstances where private residence relief is restricted.

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. They need to look at our website or contact us.’