Very similar in nature to the other voluntary tax disclosure initiatives, the Let Property Campaign is designed to encourage landlords to inform HMRC of any rental income that they have not disclose previously. With our professional advice, the right guidance and practical solutions, Churchill Tax Investigation can help you negotiate and secure a more favourable repayment plan.
The Let Property Campaign by HMRC is a disclosure opportunity for landlords of property to disclose rental income that they have failed to disclose. HMRC estimate that less than 500,000 individuals report income that they receive through rent for a second property in their tax return, yet there are almost 1.5 million landlords of residential properties. These figures led HMRC to launch their Let Property Campaign (LPC).
Landlords who fail to come forward voluntarily will be issued with a prompted disclosure letter. These letters provide landlords with a period of 30 days to contact HMRC and three months to disclose and address their tax affairs.
HMRC launched this campaign and are targeting it specifically at residential landlords who have not declared rental income. The campaign does not apply to individuals renting commercial properties or companies who own rental property.
For individuals who would like to make a disclosure under this scheme, firstly it is advised that you speak with a tax specialist such as ourselves who can provide you with expert advice. Once you have sought advice, you will need to submit notification that you intend to make a disclosure. This can be completed online or over the telephone. Once you have declared your intention to make the disclosure, the full disclosure must be made and submitted to HMRC along with any tax due within a three month period. HMRC give lower penalties to those who voluntary make disclosures than those who do not.
This campaign doesn't have a deadline but HMRC have established a new taskforce to address the issue of not declaring rental income. HMRC are using a range of tools such as rental deposit scheme records as well as Land Registry documentation to check up on people who may be generating rental income but not declaring it.
It is difficult for us to advise what penalty you would receive for not declaring rental income because every situation is different. The rates at which penalties are set will depend on whether a prompted or voluntary disclosure was made along with a range of other factors. The penalties are usually nominal for voluntary/ unprompted disclosures. You will be charged interest from the date the tax becomes due until the date it is paid in full. Any incomplete or inaccurate disclosures will result in an even higher penalty.