The let property campaign: should you make a disclosure?

by | Aug 15, 2018

If you’re a residential landlord with undeclared rental income in the UK or abroad, you have the chance to save on HMRC’s penalties by making a disclosure now. 

You can do this through the let property campaign, which intends to give individual landlords “an opportunity to bring their tax affairs up to date” without incurring serious fines.

So far, the campaign has received more than 34,000 disclosures and protected more than £150 million in tax, interest and penalties.

Why should you take part?

HMRC is actively tracking down individuals and business owners who aren’t paying the tax they should be, to close its estimated tax gap of £33 billion for 2016/17. In general, it’s increasingly likely that anyone with unpaid tax liabilities could be caught out.

In many cases, owning up now will result in a much lower penalty than being caught out by an HMRC investigation.

If you don’t disclose your unpaid tax on rental income, you could face higher penalties or even prosecution.

Who can make a disclosure?

The let property campaign accepts disclosures from:

  • landlords that have multiple properties
  • landlords with single rentals
  • specialist landlords with student or workforce rentals
  • those with holiday lettings
  • renting out a room in your main home for more than £7,500 a year
  • landlords who live abroad or intend to live abroad for more than 6 months and rent out a property in the UK.

You can’t use the scheme if you’re renting out commercial property, or if you’re a company or trust renting out residential property.

What are the penalties?

If you don’t disclose your unpaid rental income, you could face penalties of up to 100% of the tax you owe.

Disclosing your liabilities before HMRC prompts you to do so will usually result in much more lenient penalties.

How to make a disclosure

The first thing you’ll need to do is to notify HMRC that you want to make a disclosure. At this stage, you don’t need to provide any details about the undisclosed income or the tax you may owe. 

After you notify the Revenue, you’ll have 90 days to work out what you owe, make your disclosure and pay your unpaid tax.

If HMRC ask you for more information, it’s in your interest to help them as much as you can. They’ll take into account how much you co-operate with them when they’re working out your reduced penalty.

Talk to us

If you’re not sure whether you have income you need to disclose, or if you want to know more about making a disclosure, we’re happy to help. Get in touch to talk about the let property campaign. 

HMRC investigations can cause significant disruption and costs to your business. In the event that you do come under investigation, it’s best to be prepared.

We offer our clients fee protection insurance from CCH, which covers you against the costs of dealing with a full HMRC inquiry.  

You deserve more

When you start seeing results, you’ll have more time to focus on what matters most. That’s the joy of a great partnership.