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Over the last few years, taxpayers and their agents have been receiving letters from HMRC as part of dedicated campaigns being run by HMRC designed to encourage taxpayers to review their tax position and ensure their tax affairs are fully up to date.

We are aware that HMRC has once again issued letters this month to some taxpayers asking them to check whether any claims for rollover relief under s.152 TCGA 1992 for residential rental properties have been made correctly. The letters include a 30 day deadline to respond or amend their tax returns accordingly. Failure to do so will potentially lead to HMRC opening an enquiry into the taxpayers’ tax return(s).

What should you do if you receive one of these letters from HMRC?
The first point to note is that HMRC are not necessarily saying that your tax return is wrong. HMRC want to make sure that any claim for rollover relief has been made correctly. Therefore, it is essential to check whether your tax affairs are correct and complete to the best of your knowledge and belief before responding to the letter.

If an amendment is required, this can be done by amending the tax return in question or via a disclosure to HMRC using HMRC’s digital disclosure service. The most appropriate approach will depend on your individual circumstances.

If no amendment or disclosure is needed, you may wish to consider sending HMRC an explanation by letter. Where no response is received, HMRC may follow up, so not responding at all could prolong the issue and lead to follow up enquiries from HMRC. Responding to the initial letter may reduce the risks of further action being taken by HMRC.

Contact us:

Natalie Martin
Harpreet Bhangal
Senior Manager
Andy Olymbios