Are you a landlord who lets rural houses and holiday property? If so, HMRC urges you to take the opportunity to get your tax affairs in order, as HMRC launches its latest Let Property campaign.
The campaign began in April, and it allows any landlord of let property to catch up where they have either avoided or inadvertently (or deliberately) not paid tax on rental profits. Lower penalties can arise for those who come forward under this campaign. The opportunity to come forward now, before waiting for HMRC to start compliance checks, could save you a lot of money in penalties. This is the latest in a series of similar campaigns, by HMRC to increase the tax take.
The decision is simple; own up and declare that you have unpaid or underpaid tax and receive lower penalties for your honesty, or, wait to be found out and risk paying much higher penalties. It’s clearly in your best interest to do the former.
Concessions include being able to tell HMRC how much tax you think you should pay, being able to spread payments instead of having to pay one lump sum, and also being able to make a disclosure at that time about any other unpaid tax, for example on untaxed earned income (profits), un taxed investment income (interest), and any capital gains. Conversely, those with undisclosed tax liabilities who do not come forward and are investigated can expect HMRC to use the full weight of the penalty regime which is a penalty of up to 100% of unpaid liabilities, or in the case of offshore income, 200%.
In conclusion, it seems honesty is the best policy. We can help get your tax affairs in order, so please do contact us with any questions or queries you may have.