Do you own a second property that is rented out? Perhaps you inherited your parents home and subsequently rented the property. Do you rent a room in your home? What about the flat you bought for your son when he started university that your son shares with his flatmates? What about the holiday home in France which you use for part of the year but is also rented out?
Have you declared this income? There are many senarios where rental income needs to be declared to HMRC.
HMRC launched the Let Property Disclosure campaign in Dec 2013. This campaign is targeting residential home owners, many of whom are unaware that the rent they receive is taxable and that they may need to complete a self assessment tax return to declare this to HMRC.
Even when you rent a room in your home, if the rent exceeds £4250 (or £2125 if you own the property jointly), you can still be caught out.
HMRC has access to more and more sources of information. The launch of HMRCs data analytical tool ‘Connect’ has already generated £2.6bn of previously unidentified tax evasion yield. This tool works by connecting 28 different data sources and allowing HMRC to search on individuals, properties, and even telephone numbers.
The Let Property Campaign is the ideal opportunity to come forward and disclose any undeclared income with a reduced penalty regime being offered. Please do not underestimate the penalties that could be levied should HMRC find you first.
If you need any further information on this campaign or any issues surrounding this, please do not hesitate to contact me.
EJ Chartered Accountants
Tel: 07974 418737 or 01246 431702