£150m in unpaid Capital Gains Tax recovered

In the last year, £154m has been recovered by HMRC from collecting unpaid Capital Gains Tax, according to Collyer Bristow, a private client law firm.

Collyer Bristow received figures from the Revenue, and found that HMRC’s local compliance teams managed to collect £115m, following a crackdown on the use of schemes to avoid paying Capital Gains Tax.

Examples of tactics used, by both businesses and individuals, to avoid paying as much tax as was required included using offshore trusts and shores, and also creating artificial capital losses.

Counter Avoidance Directorate, a new division of HMRC, was set up to deal with ‘marketed tax avoidance schemes’, and this garnered £39m for the taxman.

James Badcock, a partner at the law firm, said: “The decision not to extend reductions to this group – alongside soaring property prices, particularly in London – means many face a substantial Capital Gains Tax bill when they come to sell, and maintains the heavy pressure on the but-to-let sector.”

“Investors will be keener than ever to ensure tax efficiency. Planning to reduce Capital Gains Tax paid within reason is sensible but taxpayers must seek advice and ensure that they do not cross the line into what could constitute abusive avoidance or evasion,” he continued.

The rates of Capital Gains Tax are being reduced this April, which has been greeted with approval by Badcock.