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The Airbnb UK company accounts for the year to 31st December 2019 contain a statement shared with HMRC on the individual earnings of hosts during 2017-18 and 2018-19. 

The up-to-date data on the income of Airbnb hosts will enable HMRC to launch tax investigations into individuals who have yet to declare any income from Airbnb lettings in the last two tax years. 

HMRC have 12 months from the date of submission to launch a formal enquiry into an individual’s 2018-19 self-assessment tax return, so there may still be time for them to act. 

Under the discovery rules, HMRC has the authority to delve even deeper into a property landlord’s tax affairs – as far back as 20 years if needed. 

It’s expected that HMRC will seek to redress the balance over undeclared income from Airbnb agents in the 2021-22 tax year. 

In the 2017-18 tax year, Airbnb’s insights report suggested the average annual earnings from a UK-based host was £3,100 and up to £3,800 in Scotland. Individuals have a £7,500 rent-a-room relief allowance, below which landlords letting out part of their main home are not obliged to report for tax. 

Nevertheless, Airbnb hosts letting out second or third properties and earning income of more than £1,000 during a tax year are obliged to report this for tax purposes. 

It’s still possible for landlords to amend their 2018-19 self-assessment tax returns to accurately account for their letting income if they wish. Amendments can be made up until 31st January 2021. 

If income from Airbnb and other lettings relates to the 2017-18 tax year or even further back, taxpayers are urged to disclose this voluntarily to HMRC under the Let Property Campaign. 

The Let Property Campaign has been open since September 2013 and is reserved exclusively for taxpayers letting out residential property across the UK. 

The primary benefit of voluntarily disclosing via the Let Property Campaign is to minimise the penalties imposed by HMRC for previous non-disclosure. In fact, if full disclosure and payment of unpaid tax is made before HMRC discovers the issue, the penalty may even be withdrawn entirely. 

If you are worried about this and want an expert to update HMRC for you then please do contact TaxAssist Accountants and let us manage your tax affairs for you. We work with thousands of landlords each year and we’re here to help you save tax and penalties wherever that’s possible. Contact us on 0800 0523 555 or use our online contact form.

Last updated: 8th October 2020

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