Saturday, 10 October 2020

Outbreak of common sense at HMRC

From Landlord Today:

An accountancy firm is warning Airbnb landlords they may be investigated following a decision by the short lets platform to share data with HM Revenue & Customs.

The Grunberg & Co accountancy practice says that in reporting its tax affairs to HMRC - in the shape of its accounts to December 31 last year - Airbnb has also agreed to share data for the two preceding tax years.

Alexander Kossoff, a partner at Grunberg, says so-called ‘hosts’ for Airbnb may wish to ensure their tax affairs are in order as a voluntary disclosure to HMRC could help to reduce any potential fines.

The comments are surprisingly supportive of the move, but there are those who don't get it:

Paul Barrett: Short term holiday lettings could easily transfer to or other short term letting sites although spareroom does all types of letting. If the AirBnB platform isn't used then lettings cannot be detected.

Robert Brown: In that case, HMRC will (eventually) turn their attention to I know that they do occasionally focus on small local holiday letting agents where there are lots of holiday lets and flex their muscles. I enjoyed witnessing this happen in a popular Open Golf venue a few years ago, with a healthy six or probably seven figure sum extracted from many home owners cashing in on five figure rentals from golfers and spectators.

Why HMRC haven't always been trawling all these possible data sources - letting agents, banks which do buy-to-let loans, HM Land Registry (to identify owners of multiple homes), local councils and insurers (where council tax bill or insurance bill is sent to a different address), housing benefit departments - remains unknown.


mombers said...

25% of landlords collect housing benefit - I'm amazed that this low hanging fruit has not been picked. Unlike other most tax evasion, you have a fixed asset to attach a lien against to recoup the evaded tax if the l/l doesn't pay up

Robin Smith said...

They use spreadsheets?

Mark Wadsworth said...

M, it is possible that they do cross refer to housing benefit claims, but I don't know.

Mark Wadsworth said...

M, or... they just shouldn't make HB payments until LL has shown that he has paid tax on all income from that particular home, and then withhold 20% basic rate tax from HB payments anyway.

Dr Evil said...

Because the government has never racked up spending like it has done since March. No contribution too small.

Robin Smith said...

Yup Dr. Evil on spending.

Big Q #1: where is the spending ending up finally - in goods and services (inflation) Or non productive assets(house prices)

Big Q #2: who pays in the end - the tax payer or real estate owner

It would be tempting to assume the latter for both. And there's so e broad evidence supporting it too.

We could also get into and probably debunk MMT while on the topic.

Mark Wadsworth said...

Dr E: "Because the government has never racked up spending like it has done since March."

It's a Tory government, what do you expect?

"No contribution too small."

They should have started doing this decades ago, however much or little they are spending.