HMRC is giving landlords a final chance to get their tax affairs in order.
The Revenue has launched a new tax amnesty scheme intended to claw back some of the estimated £500 million that is underpaid by landlords every year. The Let Property Campaign will offer reduced penalties to those who set their tax affairs in order now, while those who are later found to have underpaid their tax could face criminal prosecution.
The amnesty will run for 18 months and, according to Chief Secretary to the Treasury Danny Alexander, provides landlords with an opportunity to “pay up or face the consequences.”
The Treasury estimates that as many as 1.5 million landlords may not have paid what they owe. Mr Alexander added: ““Over the last decade rents have risen twice as fast as wages, stretching family budgets. But some landlords still failed to pay the right tax due on the rents they receive. I’m talking about landlords who own more than one property, who rent to students, people with holiday lets and those who let houses in multiple occupations.”
The Let Property Campaign is the latest in a string of amnesties launched by the Revenue. Since 2007 these campaigns have collected more than £800 million, of which £552 million was recovered from individuals approaching HMRC. The remainder was secured through “follow-up activities” and criminal prosecutions. The Tax Return Initiative, targeted at higher rate taxpayers who have failed to submit a tax return, has secured more than £80 million alone. Health professionals are set to be targeted next.
Landlords who are concerned that they have underpaid tax can contact the Let Property Campaign hotline between 9 am and 5 pm Monday to Friday on 03000 514479.