The number of stamp duty land tax (SDLT) tax investigations by HMRC has fallen by 75% in the past year from 2 096 in 2019-20 to 529 in 2020-21 shows research from Boodle Hatfield.
The law firm suggests that the drop in investigations may be due to HMRC diverting resources away from traditional tax compliance work and towards the administration of the furlough scheme during the pandemic. However as the furlough scheme winds up and HMRC returns to normal working practices tax investigations are expected to begin to return to pre-pandemic levels soon.
Kyra Motley partner at the firm said: ‘It is an astonishingly sharp drop in SDLT investigations especially when set against the boom in residential property transactions. It seems unlikely that this drop in investigations means there has been a similarly sharp drop in wrongly claimed SDLT reliefs.
‘HMRC will be keen...
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