Getting your house in order – new tax campaign targeted at landlords

As part of its increased focus on tackling tax evasion and aggressive tax avoidance HM Revenue & Customs (HMRC) has launched the Let Property Campaign, which offers landlords the opportunity to disclose and settle their historic tax affairs.

HMRC’s focus on tackling tax evasion and avoidance continues to gain traction, with the Let Property Campaign being another clear example of the opportunities offered by HMRC to enable taxpayers to voluntarily disclose and settle historic tax issues in an efficient and cost-effective manner.

The campaign, which launched in September 2013 and is expected to run for at least two years, allows landlords who rent out residential property to regularise their historic tax affairs before they’re approached by HMRC. It’s aimed at tackling the £500m of tax that HMRC estimate is being underpaid annually by up to 1.5m landlords across the UK.

The campaign is available to all residential landlords who owe tax to HMRC, whether arising as a result of misinterpretation of the rules, negligence or deliberate underpayment of tax liabilities.

By coming forward voluntarily it’s possible to settle all historic liabilities (including any relevant interest or penalties) whilst benefitting from favourable terms, such as reduced penalty rates and immunity from criminal prosecution. The campaign follows the recent growth trend in voluntary disclosure facilities operated by HMRC, which include the agreements with Jersey, Guernsey and the Isle of Man covered in the latest edition of our Taxman magazine.

These facilities, along with the Liechtenstein Disclosure Facility (LDF), offer wider opportunities for clients to settle all their historic tax affairs on beneficial terms. In some circumstances, these facilities can also be used to disclose liabilities arising purely from UK-based assets. Depending on the facts,  it may be possible to use one of these facilities to achieve a more beneficial financial outcome when settling historic landlord-related tax issues with HMRC. So it's imperative to consider all possible routes to settlement with HMRC and consider what is the best possible mechanism for regularising historic  tax affairs.  

For more information or advice please call Ronnie Pannu on 07801 685 102 or your usual contact in our tax dispute resolution team.