Blears paid no tax on sale of flat

• Press Association, Sunday May 10 2009

Communities Secretary Hazel Blears is facing fresh questions over her expenses.

It comes after she admitted she did not pay capital gains tax on profit from the sale of a London flat.

Ms Blears sold the property in Kennington in August 2004 for £200,000, making £45,000 profit.

The flat had been designated as her "second home" under Commons rules, meaning she was able to claim back thousands of pounds in mortgage interest and running costs.

But the Salford MP confirmed she had not been liable for any capital gains tax - indicating that the flat was simultaneously registered with the taxman as her primary residence.

A spokesman for Ms Blears said: "Hazel has complied with the rules of the House authorities and (HMRC). No liability for capital gains tax arose on the sale of her flat in Kennington."

Capital gains tax is charged at 40% when you sell a property not regarded by the taxman as your main residence, meaning that Ms Blears could have been forced to pay out £18,000.

The news emerged after receipts leaked to the Telegraph revealed that Ms Blears received expenses towards three properties in a single year.

In March 2004 she designated her second home as a house in her Salford constituency. During that month she bought an £850 TV and video recorder and a £651 mattress for this home. The following month she changed to declare the Kennington flat as her second home. After selling it four months later she apparently claimed for nights in hotels in London, including one where rooms cost £211 a night.

In December 2004 Ms Blears purchased another London flat with a mortgage of more than £1,000 a month and declared it as her second home. Over the next four months, she claimed for groceries, furniture worth £4,874, a bed at £899 - and another new TV costing £913.

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