Landlords to be targeted by HMRC
A new scheme aimed at landlords who may owe tax, whether through misunderstanding the rules or deliberate evasion, was launched in September 2013. The campaign will run for at least 18 months and HMRC will allow landlords to come forward voluntarily throughout the entire time period that the disclosure opportunity remains open.
HMRC have confirmed that taxpayers that come forward voluntarily as part of the initiative will receive better terms and lower penalties than if targeted by HMRC. From this year, any landlords that have not declared all their rental income may be contacted by HMRC. They will then lose the opportunity to make a disclosure as part of the campaign. Landlords who are targeted by HMRC can face penalties of up to 100% of the tax due together with possible criminal prosecution.
The campaign is open to all residential property landlords including those that have multiple properties and single rentals as well as to specialist landlords such as student or workforce rentals, and holiday lets owners. HMRC estimates that up to 1.5 million landlords may be underpaying up to £500 million in tax every year.