Taxation: Property

Treasury written question – answered on 25th January 2010.

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Photo of Andrew George Andrew George Liberal Democrat, St Ives

To ask the Chancellor of the Exchequer what recent assessment his Department has made of the extent of the practice of re-designating property ownership to avoid tax liability on the sale of second homes; and what estimate he has made of the likely effect on revenue of such practices in the last 12 months.

Photo of Stephen Timms Stephen Timms Parliamentary Under-Secretary (Department for Business, Innovation and Skills) (Digital Britain) (also HM Treasury), Financial Secretary (HM Treasury) (also in the Department for Business, Innovation and Skills)

No such assessment has been made, as it is not possible to distinguish between the cost of private residence relief attributable to nominations of main residences for avoidance and non-avoidance purposes.

HMRC apply a risk-based approach to investigating any cases where they suspect an individual has nominated a property as the main residence on a spurious basis.

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