Hi,
I'm new here, have searched for an answer and could not find one, (even though there may be one).
I am executor for a friend who passed away in September. In 2012, he sold a big victorian property that was converted into flats but, as far as I was aware, he didnt let any of the flats from about the year 2000, and lived in the whole of the property as his main residence, (If you saw the house you would see how it could be let out as flats, or lived in as a whole, or part, or parts). Since his purchase in 1983 he lived in the property/part of it. As far as I am aware, he didnt declare a capital gain so I have appointed an accountant, (Decent sized firm of chartered accountants), to help with finding out what might be due, and what the penalties might be.
In his papers I discovered tax returns going back to 2006/7, and in 2006/7 he declared a property income of £3k and in 2007/8 he declared a property income of £1500. I have now established that he let the top floor of the house to some friends when they were between houses, and the figures would equate to about £500 a month for 9 months. No rental income was declared since 2007/8, but I don't have copy tax returns for prior years, and these would be useful in establishing whether, and to what extent, the property was let.
I have asked the accountant to ask HMRC for copy tax returns back to say, 1998, or as far back as is possible, but he has replied that HMRC do not have the authority to release this information to him. He adds that, as I have the Grant of Probate, they might release it to me, if it is available. I have no idea how to go about making this request, and his answer was quite blunt, so I'm wary of asking - hence, here I am.
I completed HMRC form P1000 in December, which I thought gave HMRC authority to deal with my accountant, and I have now received their form P1001, asking again if I want them to deal directly with a proffessional.. I thought this had been asked and answered.
Anyway.. if it's possible for me to obtain the info, I'm happy to do it - it's a learning curve, and it saves the estate some accountancy fees.
Hope the above makes sense, and that somebody can point me in the right direction.
Richard
Replies (15)
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Sorry, but why does it matter? If it was his residence then there is no capital gain to pay, so let sleeping dogs lie.
Well it might
if as noted it had been converted to individual flats and only lived in one with letting of others.
So far as rental is concerned HMRC can only go back 6 years from the year of death if they assess within 4 years of death
To be fair he actually said
and he sold a big victorian property that was converted into flats
so it is a possibility that CGT would be relevant. Since his purchase in 1983 he lived in the property/part of it.
Done to death on that forum
on UK Business Forums. Obviously didn't like the answers
as above
From what I understand of your post , as executor you are concerned about the deceased's accurate disclosure of rental profits and capital gains tax on his historic tax returns . And if it is concluded there are "gaps" - you would like to inform HMRC before they knock on your door ?
Please confirm my understanding is correct.
I am pleased to hear you have appointed a firm of accountants. DO NOT DIY ANYTHING. All you have to do is dig out paperwork and forward it to your accountants
Did your friend DIY his tax returns or did he use an accountant ? His agent's details should be disclosed with in the tax returns you have. Trace his old agent and ask them for missing tax returns.
For your agent to gain authority - obtain form 64-8. insert your name and sign off as executor, insert deceased name and their unique tax reference and NIC number. Your agent fills in the rest and submits it to HMRC.
I think you need to meet your agent and spell out what your concerns are. They will assess the magnitude of your concerns and quote you accordingly.
Avoiding sleepless nights will come at a cost. Take heed of your agents advice.
It remains a moot point whether there is any CGT liability
If the property was converted into individual flats with no connections & separate entrances then there might be CGT to pay. Even then it could well be that most of any gain was covered by PPR - see HERE
If instead it was a single property that he used as his main residence with the brief lets that were potentially Rent A Room then there's no CGT as it's all exempt as PPR