"The Revenue is targeting widespread tax evasion on property lettings, and estimates that one million buy-to-let and other private landlords are not declaring their rental income, cheating the public coffers of at least £550m a year. Many are understood to be using inflated claims for letting expenses to pay less tax than they should. "A lot of people are knowingly not declaring," said an HMRC spokesman. "We want to hammer down that £550m – it's significant money."
"HMRC is running a Let Property Campaign to encourage landlords to come clean, or risk higher penalties. As well as those with undeclared rental earnings from previous years, the campaign is aimed at landlords who have filed inaccurate tax returns."
See more details from this news article from the Guardian Newspaper (UK).
Let Property Campaign - https://www.gov.uk/let-property-campaign
Quoted from UK HMRC website:
The Let Property Campaign gives you an opportunity to bring your tax affairs up to date if you’re an individual landlord letting out residential property in the UK or abroad and to get the best possible terms to pay the tax you owe.
If you owe tax on your letting income you’ll need to tell HM Revenue and Customs (HMRC) about the income you haven’t declared by making a voluntary disclosure.
To get the best possible terms, you must tell HMRC that you wish to take part by filling in a notification form or calling the Let Property Campaign helpline on 03000 514 479. You’ll then have 3 months to calculate and pay what you owe.
To get the best possible terms, you must tell HMRC that you wish to take part by filling in a notification form or calling the Let Property Campaign helpline on 03000 514 479. You’ll then have 3 months to calculate and pay what you owe.
Your UK Tax Obligations
If you own a buy-to-let property in the UK, you will be liable for UK Income Tax on your lettings income.
In our experience, the UK HMRC is quick to notify us of our obligation to file returns under their Self-Assessment system. We have been filing our returns and paying our taxes for several years now. We are happy that our taxes with the UK HMRC are up-to-date. It came as a surprise to read the UK news that the UK Taxman was now clamping down on all these tax evaders.
We will blog about filing UK taxes at a later time. Suffice to say, pay your fair share to the UK Government if you are deriving rental income from the UK. It is only right to do so!
Happy investing!
