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Landlords : Bring your UK tax affairs up to date before Renters Reform Bill is enforced
by Zoe Chandler , Chartered Tax Advisor at Milsted Langdon
The Government is looking to introduce the Renters Reform Bill , which if made law , will be the biggest shake-up to housing laws in forty years .
Whilst the Bill will have implications for the 11 million renters in the UK , landlords have been advised to ensure that they are up to date with their taxes , as the Bill can potentially give HM Revenue & Customs ( HMRC ) more power to investigate compliance within the housing sector .
As part of the Bill , it has been proposed that a database be created with details of landlords and their properties let under residential tenancies .
Whilst primarily a useful tool for renters to check out the background of their landlords , the database could open the doors to HMRC , enabling it to use the publicly accessible data for compliance activities .
The Let Property Campaign With the potential for stricter compliance for landlords under the new legislation , they are encouraged to keep up to date with their tax payments and reporting .
One scheme designed to aid landlords with getting up to date with tax is the Let Property Campaign .
It is an opportunity for landlords who owe tax through letting out residential properties both in the UK and abroad to get up to date with their tax affairs in a simple way and to take advantage of the best possible terms .
Take part in the Let Property Campaign If you would like to take advantage and get involved with this campaign you need to :
• Notify HMRC that you want to take part in the campaign
• Disclose to HMRC all income , gains , tax , and duties you have not previously told them about
• Make a formal offer
• Pay what you owe
• Help HMRC as much as you can if they ask you for more information
When you make your disclosure , you can tell HMRC how much you believe you should be paying in inaccuracy or late notification penalties .
The payment will depend on the reasons why you have failed to declare your income . Any deliberately withheld information will incur a higher penalty than a simple mistake .
Disclosing your tax information this way means that in the event you are required to pay a penalty , it will be much lower than it would be if HMRC finds out you have not paid enough tax .
The law allows HMRC to go back up to 20 years , and in serious cases , HMRC may carry out a criminal investigation .
The potential for a new public database for HMRC to investigate landlords is an additional reason why landlords should keep up to date with their taxes , and if they feel that they are not , then use the Let Property Campaign to ensure minimal penalties and avoid possible criminal charges .
If you are a landlord in need of tax advice , please get in touch . zchandler @ milstedlangdon . co . uk
or call : 01225 904940
For more information : www . milstedlangdon . co . uk
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