Savings and tax man

notbright

I have a bit of savings and in 2019 my wife and I purchased a Bungalow that needs all our savings to renovate it. I'm 72 years old. Now just before Xmas we get a letter from DWP saying they believe we have undisclosed capitol and we have to supply them with the last 4 years bank statements. The only people that could have told them us the bank or the solicitor who dealt with our purchase. The person who bought our old house had already sold and was in a caravan and had no mortgage, we had no mortgage. So the deal was done through solicitors and bank. Does anybody know if the bank is abbliged to tell the tax man about this sort of activity? 

eskbanker

Where does 'the tax man' (HMRC) fit into this?  Your purchase of the property will be visible to a number of authorities, including Land Registry and local council - I'm not sure to what extent data will be shared but DWP will be obliged to follow up if there is any hint that you're claiming benefits that you're not entitled to, for example....

born_again

Yes banks do have to report to the tax man.....

If you have been claiming means tested benefits and had more savings than allowed, then expect a bill.

sheramber

DWP is not HMRC.  They are two separate entities.

Alter_ego

So , are you claiming benefits you're not entitled to?

Ballard

Although it's not completely clear, the inference from your post is that you've had undisclosed savings which has allowed you to claim benefits to which you wouldn't actually be entitled. If that's true then you're just going to have to own up and probably repay the DWP. You're not going to be able to blame any organisation for disclosing this probable wrongdoing. 

Old_Lifer

The bank will make an annual return of interest earned by the account holder.    Even in the 1960's insurance companies were obliged to submit a return at the end of each tax year listing those who had received insurance  commission during the year with names and amounts of commission paid.

I recall reading a few years ago,  that nowadays  a whole range of  government organisations are required to submit returns  ( I think to the Audit Commission ?  )     It was a very interesting read.    It seems data matching is carried-out  which will pick-up those who are on means- tested benefits but have received a large amount of  interest  or have an undisclosed ISA,    or those who are  'unemployed' but actually working, perhaps by renting a market stall in a neighbouring Council area,     or those who are claiming housing benefit while having another home in a different area.