HMRC has recently launched a new campaign aimed at offshore companies that own property in the UK. Using Land Registry data, HMRC has identified property owners who may not have met their UK tax obligations. As a result, they may send a “nudge letter” to taxpayers whose tax affairs do not appear to be in order.
The nudge letter campaign is divided into two types of letters, depending on the circumstances of the offshore property owner:
- Non-UK resident companies who may need to declare income received as a non-resident corporate landlord, or pay Annual Tax on Enveloped Dwellings (ATED).
This letter will be addressed to the company and will recommend that UK-resident individuals who have an interest in the income or capital of the company ensure that their tax affairs are up to date, particularly in relation to the Transfer of Assets Abroad anti-avoidance legislation.
- Non-UK resident companies who appear to have disposed of UK residential property between 6 April 2015 and 5 April 2019 without submitting a non-resident capital gains tax return.
This letter will also be addressed to the company and will advise that the company may need to file a non-resident capital gains tax return for the relevant period.
It’s important to note that HMRC doesn’t issue nudge letters automatically, so if you receive one, it’s important not to ignore it. It’s best to speak to an accountant or tax advisor as soon as possible to ensure that your tax affairs are in order.
At Seagrave French, we can help you navigate the complexities of UK tax regulations and ensure that you are in compliance with all tax obligations. We can also help you understand the implications of receiving a nudge letter from HMRC and guide you through the necessary steps to take to ensure that your tax affairs are up to date.
If you’re an offshore corporate property owner and have received a nudge letter from HMRC, or if you simply want to ensure that your tax affairs are in order, contact us today to discuss how we can help.