Accounting and Financial News Headlines

News Headlines

I'ts never too late
Following a recent House of Lords judgement new legislation has given a window of opportunity for businesses to claim for VAT which they had previously either over declared or under claimed but were now out of time to do so.
Businesses have until 31 March 2009 to make a claim for either any output VAT which they had over declared or for any input VAT which they had under claimed relating to the period 1 April 1973 to 1 May 1997.
This one off claim period has been given as the House of Lords ruled that a transitional period should have been allowed when the three year time limit for claims was introduced from 1 May 1997.
It may mean trawling through old records to calculate your claim but for some businesses this could be a windfall. Particularly for any businesses which have successfully made claims for periods within the three year time limit but were previously not able to go back far enough.

Property tax checks
HM Revenue & Customs have announced that they have launched a campaign targeted at Property Owners. It is their intention to carry out a number of compliance checks which will highlight those who have not declared all of their income from property.
The campaign involves the sending of letters to property owners along with a standard form on which details of any income to be declared are to be completed. HMRC have advised that where the property owner has an authorised agent a copy of the letter will be sent to the agent too.
The first batch of letters are to be sent to those who have completed Self Assessment Tax Returns but HMRC suspect have not disclosed all of their rental income. They will then focus on those who do not complete a Self Assessment Return.
HMRC would appear to be particularly targeting those with buy to let properties. It is thought that this follows the increase in recent years in the number of people who own investment properties. Those who receive rental income under the rent a room scheme and those with furnished holiday lettings are also being targeted.
The property owner may have no income to declare related to the property, in which case they need simply complete the form advising as such. Alternatively income may have been received relating to the property but due to mortgage interest a net loss has been made so resulting in no taxable liability, in this scenario the income should still have been declared and HMRC should be notified.
In all instances the letter will need to be responded to within 30 days to prevent HMRC taking any further action. It is therefore important to ensure you do not ignore it. HMRC may be taking a light approach initially but failure to respond could lead to an enquiry into your tax affairs which could be a costly operation.
If you are a property owner and receive such a letter it is recommended that you contact your adviser as soon as possible to ensure you have made the full disclosure that is required. The important thing is to seek advice.