Ensure your letting income is declared

Q: I’ve been letting out a residential property for several years, but haven’t advised HMRC. I have heard they are running a campaign aimed at landlords. Who can take part in this and how do you do this? – Anon, Eyemouth

A: HMRC are running a ‘Let Property Campaign’ which gives landlords an opportunity to bring their tax affairs up to date and offers the best possible terms to pay tax owed.

If you calculate that you owe tax on your letting income, you should advise HMRC, who state that in order to get the best terms, you must inform them that you wish to take part in the campaign. Following this, HMRC allows three months for you to calculate and pay any tax due.

The campaign is open to residential property landlords and this includes landlords of multiple properties, holiday homes, properties located abroad, student or workforce rentals, and those who rent out rooms in their own homes for more than £4,250 a year (or £2,125 a year if letting the property jointly).

It is not open to companies, trusts or landlords renting out commercial property.

A questionnaire is available on HMRC’s website which can be used to help decide whether you need to disclose unpaid taxes under this campaign. HMRC have also published examples of common errors landlords make.

HMRC have advised that they will use information held to identify people who have not paid what they owe and that for those who fail to come forward, higher penalties or even criminal prosecution could follow.

Rennie Welch LLP accept no liability on the basis of this article and detailed advice, taking into account individual circumstances, should be obtained before entering into any transaction.

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