Don’t assume that the Revenue won’t investigate you for the profit on your rented property, writes Jonathan Wilson, Partner at Barnett & Turner. A new campaign is under way and it’s time to take action. According to HMRC, landlords may owe more than £500m in unpaid tax from the profit they make on renting out homes. Although there are 1.4m people who let property in the UK, half a million of them aren’t even registered with the taxman. It’s figures like these which have led to the creation of the Let Property campaign, in which the Revenue may investigate as many as 900,000 property owners renting out homes in the UK and overseas.
Although the news may come as a shock if you’re currently a landlord of a second home or investment property, it’s worth thinking calmly and seeing the initiative as an opportunity to perhaps get your affairs in order.
You can make a voluntary disclosure to HMRC about any undeclared income by phoning the Let Property campaign helpline on 03000 514 479. Tell the Revenue that you want to fill out a notification form and they’ll then give you three months to calculate and pay what you owe.
Many categories of individual landlord can benefit. It doesn’t matter whether you have a single property or more than one. You can be living abroad and renting out a property in the UK or doing the reverse. Specialist landlords – dealing in student or workforce rentals – can take advantage of the scheme, as can someone renting out their main home for more than £4,250 a year.
It’s important to stress, however, that Let Property is not designed to be used by companies or trusts renting out residential property or anyone letting commercial property.
If you have any queries, it’s well worth discussing your position with your accountant who can deal with HMRC on your behalf.
If you would like to discuss anything related to this article please do not hesitate to call Barnett & Turner on 01623 659659 or email Jonathan at firstname.lastname@example.org