Tax investigation/emigration

Tax investigation/emigration

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Client was planning to emigrate before a tax investigation was launched.

Revenue & Customs take a different view of property transactions and are arguing they constitute trading rather than a mixture of trading and PPR. Inspector is trying to gather property transactions from 1999 onwards and appears to be lining up an argument that all PPRs since then constitute trading. In my opinion, this would be unfair and based on the facts in this case not unlike Revenue & Customs saying all builders are liable to their PPR being treated as trading if they owned a PPR for less than 3 years.

Client now emigrated, but is still is sell his UK PPR.

Client happy to pay reasonable tax, but Inspector is reopening back to 1994/95 and indications are that the Inspector is looking for something 5 or 6 times what the client considers fair. I think he regards the case as forming part of his bonus money. I already have evidence that this particular Inspector is using underhand tactics that are contrary to HM Revenue & Customs investigation procedures and manuals.

I am minded to let Revenue & Customs have all available relevant information, have a meeting when they have (finally) formed their opinion and say 'but there is only so much money available so reduce your assessment".

Views?

Can Revenue & Customs take any security against the property?

Ian

CCA TQ

Replies (2)

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By The Minion
08th Jul 2008 16:41

it is a while
since i dealt with something like this but i seem to remember when i had a client emigrating and selling a property that the obilgation to retain tax fell with whoever was acting as agent for the vendor in the UK.

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By AnonymousUser
06th Jul 2008 14:29

Builders
I can't add any advice on investigation tactics but in terms of the technical argument then, if the facts are there, HMRC have a strong case. Consider for example the precedent set by the old case of Page v Pogson 35 TC 545.

I think any builder is vulnerable to a challenge that a house he has built for his own use is a trading venture and although such challenges can be rebutted, they should not be considered unexpected or unprecedented. In fact, I am surprised how little HMRC challenge successive development projects as being trading ventures rather than CGT.

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