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Private Landlords Told to Expect More Visits from HMRC
At the end of last month the Inland Revenue announced that private landlords should be prepared to receive a knock on the door during the next few weeks, as it's launched a new task force to help recover unpaid taxes which are estimated to be up to £17 million. The specific details aren't yet known, but it's thought that the task force will concentrate on landlords with houses of multiple occupancy, and those providing temporary accommodation. It will be concentrating on private landlords in a number of areas, including Nottingham.
If it's successful then it’s likely it will be extended to cover the rest of the country. The HMRC will gather information from numerous government departments, as well as other sources such as internet and press advertisements, and colleges and universities. In addition to looking for unpaid income tax, the HMRC will be looking at a landlords VAT liability in cases where they provide temporary accommodation to students or agricultural workers. A lot of landlords are unaware that the VAT is charged on temporary accommodation, as is treated in the same way as a hotel or guesthouse. Some landlords may not be registered for VAT, and there's a chance any claims could be backdated.
Landlords are being advised to check with their accountant or tax adviser if they think they may have outstanding tax bills. They're not advised to approach the Inland Revenue directly as the system can be complicated, and they could end up with a larger tax bill than if they had taken advice.