HMRC estimates that up to 1.5 million landlords may have underpaid, or failed to pay, up to £500 million in tax in 2009 to 2010. As a result, those landlords could face criminal proceedings, unless they come forward first.
“HMRC has said its Let Property campaign will target specific types of landlords, for example, those who own more than one property, specialist landlords who rent to students, people with holiday lets and those who let houses in multiple occupation,” said Stephen Metcalf, Tax Manager of DSH in Maidstone.
“The campaign is expected to last for at least 18 months, during which time landlords who come forward to pay what they owe, whether that is through deliberate avoidance or misunderstanding of the rules, will still have to pay penalties and interest due.”
Stephen warned that at the end of the campaign, HMRC would use information it holds to track down non-payers, who will face higher penalties and possibly even criminal proceedings.
“While landlords who owe tax on rents received might think twice about the prospect of paying interest due and penalties, it is clearly in their interest to work with HMRC to avoid harsher punishments at some point in the future.
“We would advise them to talk to their accountant now, and volunteer the information sooner rather than later.”
To find out more about DSH Chartered Accountants & Business Advisors, visit www.dsh.co.uk or call 01622 690666.