HM Revenue and Customs (HMRC) is giving residential landlords the opportunity to bring their tax affairs up to date – receiving the best possible terms to pay outstanding tax – through its Let Property Campaign.
Individual landlords letting out property in the UK or abroad that are yet to declare their letting income to HMRC can make a ‘voluntary disclosure’.
A voluntary disclosure is one which the person in question has no reason to believe that HMRC has discovered or are about to discover tax inaccuracies or overclaims; or reports the change to details or circumstances held by HMRC without fear of early detection.
Residential landlords can report previously undisclosed taxes on rental income if they are:
Renting out a single property
Renting out multiple properties
A specialist landlord, e.g. student or workforce rentals
Renting out a room in your main home for more than £4,250 a year or £2,125 a year if letting the property jointly, i.e. above the Rent a Room Scheme threshold
Living abroad and renting out a property in the UK
Living in the UK and renting a property abroad
Renting out a holiday home even if you use it yourself
The scheme is not applicable to those wishing to declare undisclosed income as a company or a trust renting out residential or commercial property.
For those still unsure of whether the Let Property Campaign is the right disclosure campaign for them they can use HMRC’s helpful questionnaire to help you make the right decision about the action you need to take.
HMRC is targeting tax evasion by residential landlords. The tax authority will use information they have about property rental in the UK and abroad and any additional information they hold on customers to identify those landlords who might not have paid what they owe.
After filling in a notification form of outstanding tax due, landlords are then required to fill in a disclosure form, after which they will pay the outstanding amount no later than three months after receiving HMRC’s letter acknowledging the notification form.
Those requiring more time to pay must call the HMRC helpline well before the three-month deadline.
Residential landlords that don’t make a voluntary disclosure now could face higher penalties and criminal prosecution if HMRC finds out later; the ball is firmly in your court.
Call us today on 0800 0523 555 or complete our enquiry form and we will identify your nearest TaxAssist Accountant in order to book a FREE initial consultation