U.K. tax falls on overseas property investors

 

Overseas property owners based in the UK are about to be targeted by a new HM Revenue & Customs "affluent unit", which has been set up by the British government to address what it sees as tax avoidance by the rich.Photo 20minutos.es What next I wonder?? A new team of 200 taxation investigators and specialists has been established by HMRC to identify wealthy individuals who, amongst other things, own land and property abroad … such as a holiday home. OPP understands that the tax attack unit will concentrate on overseas property assets first, and then switch its attention to UK-based commodity traders (who have been accused of helping to drive up food prices,) before looking into the number of UK residents who hold offshore investment accounts. HMRC says that it will be using sophisticated "data mining" techniques to try and track down people who own overseas properties, but do not pay the right amount of tax. This might include someone who owns a villa in Spain which they are renting out, or an individual who owns a piece of land in France that is being used as business premises, said an HMRC spokesman. The experts will be looking for people who do not seem to be declaring the correct income and gains. The new unit, which has been announced by the UK’s Chief Secretary to the Treasury, Danny Alexander, will focus solely on people paying the 50% top tax rate. David Gauke, the exchequer secretary to the Treasury, said there would be "no hiding place" for tax cheats, adding that the UK government “is committed to tackling tax evasion and avoidance across all areas of the economy. That is why we allocated HMRC £917m to reduce the tax gap over the next four years. This new team is part of that investment." Ronnie Ludwig, tax partner at accountancy group Saffery Champness told OPP that “those who have been letting out their foreign property and declaring the rents received have nothing to fear, but those who own foreign property which has never been let out should be prepared to prove to HMRC that they have received no income from the property.” “This will involve producing UK and foreign bank statements and being able to demonstrate that they could afford to purchase and maintain the property out of normal declared sources."