HMRC has warned landlords to disclose their earnings on self assessment tax
returns.
The tax authority has clarified the guidance on who can participate in the Let
Property Campaign, which is targeted at landlords who owe tax through letting
out residential property in the UK or abroad.
Landlords can report previously undisclosed taxes on rental income to HMRC under
the Let Property Campaign if they are an individual landlord renting out
residential property.
The campaign covers landlords who rent out single or multiple properties, rent
out a room in their main home that exceeds the Rent a Room Scheme threshold and
holiday lettings.
It is also important to note that, for those living abroad or intending to live
abroad for more than six months and renting out a property in the UK, those
earnings may still be liable to UK taxes.
Tax must be paid on any profit made from renting out property. The profit is
calculated based on the amount left once claims for expenses or allowances have
been deducted.
HMRC warned:
'If you're a landlord and have undisclosed income, you must tell HMRC about
any unpaid tax now. You'll then have 90 days to work out and pay what you
owe. If you do not do this now, and HMRC finds out later, you could get
higher penalties or face criminal prosecution.'
Internet link: GOV.UK