This is a weird story. From The Mail on Sunday, 2nd December 2006:
Estate agents secretly selling home details to tax inspectors
Snooping: tax officers can now find out exactly what your home is worth.
Government officials have been given access to a vast database of properties, revealing their sale prices and detailed floorplans, under a deal with the website Rightmove.co.uk.
The site, run by four of Britain’s biggest estate agents, contains information on 800,000 properties – and the contract, which runs until 2008, also gives inspectors access to old records.
The Valuation Office Agency – the department of HM Revenue & Customs that allocates a council tax band to every home in England and Wales – will be able to use the data to find out about improvements such as double-glazing and conservatories that may increase tax bills.
What’s weird is this: Property sales in Britain now involve a direct return to the Revenue as part of the new Stamp Duty Land Tax regime. And the Lands Registry has a definitive record of all such transactions, now online, which ought to be accessible to the Revenue. Unless the transaction is registered, you haven’t bought the property. And a house’s recent, actual, sale price is going to be pretty conclusive evidence of its valuation.
So why pay a website whose coverage can be at best partial? Either HMRC is wholly incompetent (possible). Or they think transactions are being under-declared in the hot market (difficult in most cases, when two sets of solicitors and bankers are involved). Or the Mail on Sunday is missing the point and HMRC is not targeting sellers but renters and landlords. Or this is a publicity exercise, and HMRC is engaging in its favourite hobby: public intimidation of the public.