We recently welcomed a new client who had not disclosed his rental income for several years. He had previously been unaware that he should have completed tax returns historically, as he believed that when he moved and rented out his old property to cover its mortgage, there was no need to declare anything.
HMRC is running a ‘Let Property Campaign’ for people exactly like this client. It gives people the option of voluntarily disclosing undeclared income and correcting the amount of tax they pay in a very straightforward way. It also reduces the potential amount of penalties that would be incurred if they were to go back and complete all of the tax returns for the undeclared years in which they earned income through rental.
Our tax specialists have successfully completed several of these cases in the past, and found that clients have received penalties of approximately only 10-20% of what they would have paid if they had taken the traditional tax return route.
This link to a government publication gives you more information on the Let Property Disclosure. However, if this is an issue that affects you, please feel free to call Denise in our tax team on 020 8530 0720 for additional information, and guidance on the best way to sort things out smoothly and without stress or excess costs.