HMRC Headache for Investors
17 January 2023
In 2022, investment in the Northern Irish commercial property market totalled a whopping £329.25m, and had an even spread across retail, office and industrial sectors. With this trend not showing any sign of slowing, the introduction of new processes by HMRC for investors, could become a headache.
From 1 February 2023; HMRC are to add uncertainty by:
- No longer issuing OTT notification receipt letters and;
- Will also stop processing requests to confirm the existence of an OTT, except in limited circumstances (where the effective opted date is over 6 years ago and if you are acting as administrator)
Going forward OTT applications, will be submitted electronically via an email, with property details outlined in the subject line. An automated email response will be received however no other acknowledgment will be sent other than this automated email. As a result, it is imperative that taxpayers keep records of this automated response as evidence of the notification and date of the OTT.
If a notification is sent by any other means, it will not receive either an acknowledgement or a receipt.
Investors and legal teams should update historic processes and retain evidence on how OTT applies and whether conditions are met to reduce risk and ensure VAT recoverability. On a positive note, transaction times will hopefully reduce without the usual HMRC delays.
If you have any questions, please contact Lorraine Nelson or Rebekah Townsend.