A law firm says HM Revenue & Customs (HMRC) is targeting the property industry for up to £645m in additional tax.

That’s a 40% increase on 2024/25’s £461m figure. 

This is according to international law firm BCLP.

It says it’s analysed figures from the Large Business Directorate (LBD), a specialist unit within HMRC which works with around 2,000 UK firms, including those in the property sector.

Its so-called ‘tax-under-consideration’ estimate for the largest property firms is an assessment of the maximum potential additional tax liability in each case.

According to BCLP, the rise in tax under consideration likely reflects a shift in HMRC’s compliance approach. 

HMRC hired over 1,600 additional compliance officers in 2025/26 with a target of increasing compliance capacity by an additional 5,500 officers by 2030. 

The rise in tax under consideration is consistent with the additional resources at HMRC’s disposal, rather than necessarily indicating a rise in non‑compliance.

Elizabeth Bradley, a partner at BCLP, comments: “The sharp rise in HMRC’s tax under consideration for the real estate sector likely reflects the ramping up of compliance activity. HMRC is under growing pressure to close the tax gap. 

“As HMRC directs more resource and data analytics into reviewing transactions and financing arrangements, real estate groups are seeing a greater number of issues flagged for detailed examination. This is not necessarily a sign of increased non‑compliance, but of a more challenging compliance environment.”

And according to BCLP, HMRC’s strategy in applying more resource to close the tax gap is bearing greater fruit.  

In 2025 to 2026, HMRC generated more than £50 billion of compliance yield for the first time.

“HMRC’s focus on subjecting taxpayers to greater scrutiny includes capital allowances and SDLT in the real estate sector.  

“It has earmarked significantly greater amounts of capital allowances and SDLT for review. 

“The amount of tax under consideration for capital allowances rose from £483m to £762m over the past year, and for SDLT from £77m to £100m. 

“While these figures are not limited to large real estate groups, they provide a clear indication of HMRC’s current areas of focus.”

BCLP says the rise in tax under consideration also reflects a wider challenge for the property industry. 

Alongside increasing scrutiny of large real estate groups, HMRC is becoming less willing to provide clarity on the tax treatment of transactions before they take place, meaning real estate groups are receiving fewer clear answers when planning disposals, reorganisations or financing.

According to data obtained under the Freedom of Information Act, 41%of requests for HMRC confirmation of tax treatment were rejected in 2025/26 — the highest level in five years. 

HMRC’s refusal to provide a definitive “yes” or “no” answer has risen even more sharply in some areas. 

Some 63% of requests relating to Corporation Tax (CT) were rejected (105 of 168), more than double the historic rate of around 25–30%. 

The number of applications for clarity on SDLT transactions more than doubled in 2025/26, from 53 to 122, and the rejection rate (47%) also represents a jump on the historic rejection rate.

Bradley adds: “HMRC’s increasing unwillingness to provide clarity risks undermining taxpayer engagement. When taxpayers ask for guidance and receive no definitive answer, it becomes harder for them to engage confidently with HMRC before completing a transaction.”

“This poses a real dilemma for real estate groups. At a time when more real estate groups are seeking clarity on SDLT positions, HMRC is becoming more reluctant to provide definitive answers. Unfortunately, it is difficult to see the situation improving in the short term.”