HMRC’s Let Property Disclosure Campaign targets landlords who have undeclared income from residential property lettings. The campaign was launched in September 2013 and currently does not have an end date. The campaign offers landlords the opportunity to get their tax affairs up to date under the best available terms. HMRC will allow landlords to come forwards voluntarily throughout the entire time period that the disclosure opportunity remains open.
Taxpayers that come forward voluntarily as part of the initiative will receive better terms and lower penalties than if target by HMRC. Landlords that make an accurate voluntary disclosure are likely to face a maximum penalty of 0%, 10% or 20% depending on the circumstances on top of the tax and interest due. There are higher penalties for offshore liabilities.
HMRC is unlikely to accept a disclosure under the terms of the campaign where they have already opened an enquiry or compliance check. Landlords who are targeted by HMRC can face penalties of up to 100% of the tax due together with possible criminal prosecution. There are three main stages to taking part in the campaign, notifying HMRC that you wish to take part, preparing an actual disclosure and making a formal offer together with payment. The disclosure guidance and accompanying form have now been updated.