HMRC campaign takes £20m in letting sector tax
The HMRC ‘Let Property’ campaign recovered just over £20m by the end of January – a dramatic rise from the October 2014 figure which stood at just £7.9 million. The surge came after letting agents were advised to pass on information as appropriate to the tax authorities, as well as an advertising and promotional campaign by HMRC.
A report from London chartered accountancy firm Jeffreys Henry LLP shows that some 9,500 landlords have ‘fessed up’ to the taxman.
“These figures should come as a warning to anyone with undisclosed rental income. With increased data gathering actives, it is less likely a case of if and more likely when HMRC catches up with you” according to Ian Leigh, tax partner at Jeffreys Henry.
HMRC now gathers information from a much wider set of sources than the traditional local authorities, the Land Registry and the electoral roll. In late 2014, hundreds of letting agents were sent statutory notices to provide details of rents collected on behalf of all landlords.
“Landlords with undisclosed rental income should take this opportunity to come forward and regularise their tax affairs as soon as possible. Penalties as low as 20 per cent and affordable payment plans can often be negotiated for those who make a voluntary declaration as part of the Let Property Campaign” says Leigh.
Landlords who ignore this opportunity face penalties of up to 100 per cent of their tax liability and in certain cases criminal prosecutions.