High-net-worth investors using property tax relief schemes without proper advice may get hit with requests for accelerated payment, Marios Gregori, tax partner at BDO, has warned.
The HMRC announced last week that it was closing the Business Premises Renovation Allowance scheme, as part of efforts to crack down on tax avoidance, and as a result Mr Gregori warned that investors could receive notices to force them to repay the tax relief.
He said: “Business Premises Renovation Allowance was used by genuine property development companies, but unfortunately also by some promoters that HMRC are likely to argue have developed artificial tax schemes for investors.”
The scheme had been introduced to encourage conversion and renovation of empty business properties in specified ‘assisted areas’ of the country.
Mr Gregori added that there would likely be many more cases of tax avoidance going through the courts.
Adviser View
Trystan Lewis, financial adviser at Chester-based Griffin Wealth Management, said: “HMRC is clearly in need of more tax receipts, and this is why it is looking at investment schemes that have pushed themselves close to the line of being deemed potential tax evasion schemes, as opposed to tax avoidance ones.”
