Proving Income over 6 years ago to HMRC

aycee

Hi All,

Wondering if anyone can help.

Basically, if you've paid tax on income from a rental property but at the time you were a student and therefore any income generated falls within your allowance how can you prove this to HMRC? They only accept bank statements and not P60s but if you're going back over 10 years ago banks only hold 6 years worth of information.

Any help will be greatly appreciated!

Thank You

fengirl_2

Need a bit of clarification on this one. You state that you paid tax on rental income yet it was below your tax free allowance - so how come tax was paid? HMRC would have records of tax paid at least going back 6 yrs and bank statements would prove nothing.
Please explain more fully what your problem is.

Somerset

I'd imagine that hmrc have uncovered a rental property that 'on the face of it' should have been declared and tax on profit paid.

The OP is saying the taxable income was less than the PA threshold and as it was the only source of income, it wasn't declared (mistake) and no tax was paid.

Hmrc are looking to the OP to prove this argument by submitting bank statements for the relevant period which should show no other income or earnings.

Sorry OP, apart from requesting them from the bank which only gives you 6 years, I think you're stuck.

Cook_County

Given that 6 years ago is out of time for most section 9A enquiries why do you think HMRC have statutory authority that would let them see 6 years worth of bank statements? This would be an unusual request unless fraud is involved.

System

aycee wrote: »

Basically, if you've paid tax on income from a rental property but at the time you were a student and therefore any income generated falls within your allowance how can you prove this to HMRC? They only accept bank statements and not P60s but if you're going back over 10 years ago banks only hold 6 years worth of information.

How did you pay tax on the rental income?

aycee

Ah, nothing dodgy or fraudulent! It wasn't declared at the time for whatever reason and only recently been paid in full including the years he was a student (eventually moving into the property himself). Unless he can prove he was not working whilst being a student and that any taxable income was less than his PA he'll have paid tax as if he had no PA. However, he's struggling to get bank statements from that period hence why he's stuck!

Cook_County

Proving to whom? Why? Your post makes little sense from reading it as a third party. Why not file tax returns for each year showing only sources of income actually taxable?

Murdina

The bank statements are only a step in this process. They are possibly evidence one way or the other but even if you produced them and they showed nothing, HMRC might argue otherwise.

You need to think through a coherent and well thought out position and put it to them. On the whole, HMRC only go back beyond 6 years when they think there is a serious amount of tax which has not been paid. If you or whoever it is you are posting for is the subject of such an enquiry you would do well to find yourself an accountant or tax adviser who specialises in investigations to act for you.

Because if you do not , and just give in to what HMRC suggest, you are not only looking at tax but INTEREST and PENALTIES the final amount of which you will take my word for it find VERY VERY scary indeed. A competent professional will quite likely save you far more than he or she costs.

Representing yourself in a serious tax enquiry is not to be recommended.