Any real repercussions?
After chatting with a BTL colleague, I’m fairly sure this is unethical and possibly illegal, but I doubt there will be any real repercussions.
– My colleague became a first time BTL landlord earlier this year
– Advertising and offering unfurnished property
– Self Assessment tax return will include personal residence receipts for furnishings to benefit from Wear & Tear allowance
– Next year will continue the same and buying new items for personal residence and continuing to claim W&T
I doubt the tax man will check if the BTL property was being advertised as furnished or not…so I presume no repercussions in reality.
Throwing it there as I am curious if my colleague is correct.
Thanks
Ray
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Member Since February 2011 - Comments: 3453 - Articles: 286
10:36 AM, 14th August 2015, About 11 years ago
Hi Ray,
HMRC could decide to do an audit on your friend at any time as they know that this sort of thing does happen.
It may seem like a victimless little white lie, but if caught tax fraud can carry a prison term!
Member Since January 2015 - Comments: 7
2:46 PM, 14th August 2015, About 11 years ago
I understand from my accountant that if you are claiming W&T then you cannot claim for new items as they are included in the W&T amount!
Member Since July 2013 - Comments: 305
2:54 PM, 14th August 2015, About 11 years ago
Sorry Ray, not sure I understand your question. Is it “your colleague” or you who believe they doubt the “tax man will check ……”
Either way Neil is right. Believe me whilst it may sound appealing (and easy) to put one over on the tax man the consequences can be very serious.
Just one other thing, am I right in thinking the 10% wear and tear allowance is/has been phased out?
Member Since May 2014 - Comments: 273 - Articles: 2
2:57 PM, 14th August 2015, About 11 years ago
That’s what I thought, maybe a little to late to start scamming now – and really not the way to do business, always on the back foot and this is how Landlords get a bad name.
Member Since January 2015 - Comments: 7
3:00 PM, 14th August 2015, About 11 years ago
Yes I believe that it is being phased out or gone!
Member Since July 2013 - Comments: 264 - Articles: 1
3:06 PM, 14th August 2015, About 11 years ago
the changes to the 10% allowance simplified system start in 2016 but I believe this is optional now, but most would not spend 10% so this is not a good thing.
Comments: 184
3:26 PM, 14th August 2015, About 11 years ago
Why would you think its only “possibly” illegal? Come on Ray, you know this is fraud and you know its illegal.
What you really want to know is what the odds are on getting caught, and publicly available high profile internet forums (fora?) aren’t the place to get that sort of information. Go and ask a man down the pub.
Member Since October 2014 - Comments: 282
4:15 PM, 14th August 2015, About 11 years ago
Hate it when landlords try to scam that little bit extra – be it avoiding council tax or this little set-up.
The repercussions may affect everyone. I am sure that one of the reasons that wear and tear will be disallowed in its present form is because too many people skim off the top who don’t have a furnished let and don’t qualify. This ruins it for genuine claimants.
Consider what’s been announced in the Budget. Landlords are reviled as it is, and scams and rogue landlords give us all a bad name, as Harlequin Garden above pointed out. Advise your friend he’s a greedy sod and he should think about the honest landlords he’s tarring with his fraudulent brush.
Member Since June 2013 - Comments: 179
6:01 PM, 14th August 2015, About 11 years ago
A friend of mine wants to know?
Really??
This is the kiddies playground stuff
why do you want other peoples opinions on the scam you are engaging in??
Member Since April 2015 - Comments: 29
6:30 PM, 14th August 2015, About 11 years ago
Once again I am so pleased to read comments from other landlords who want to do the right thing and run a business in a proper and professional manner. Scamming isn’t clever and will one day come back to bite you. I agree with everyone else, decent landlords are the target for all and sundry these days and idiots like “your friend” are looking to save pennies only to end up justifying changes to all landlords paying hundreds of pounds because of their greed.
I hope that this friend gets his affairs looked at by HMRC because he’s shown he’s obviously a fraudster.