HMRC warned not to make assumptions about second-home owners

A expert financial adviser for some of the UK's highest earners has warned HM Revenue and Customs (HMRC) that they are risking automatically branding people who own property abroad as tax cheats, through their latest initiative to rake in more taxes. Stephen Barratt, private client director of Thames Valley-based James Cowper, told FT Advisor that HMRC was at risk of driving away any good will remaining towards it from people who are already the most heavily taxed in the country. "It is alarming that HMRC seems to be saying those with overseas property are tax cheats," he said. "If speculative inquiries are raised, owners are going to be put to what might be a considerable amount of trouble and expense just to prove their innocence."The team set up to target tax evasion is thought to have a staff of more than 200 forensic accountants and tax experts. Mr Barratt said that the vast majority of people with second homes abroad were law-abiding taxpayers, and that assuming that they were guilty of anything less than that would not be a good move from HMRC. A spokesman for the tax organisation said that they will be using sophisticated mining techniques to identify people who have properties, and then to examine whether they have the means or not to sustain two homes.

http://www.50percenttax.co.uk/index/2011/11/11/hmrc-warned-not-to-make-assumptions-about-second-home-owners.html