Landlords who rent out residential property and have not returned the relevant income from this source or paid the tax thereon are being offered a new disclosure opportunity by HMRC under the ‘Let Property’ campaign.

Based on their intelligence data, HMRC estimates that up to 1.5 million landlords in this sector may be underpaying up to £500 million in UK tax every year. Therefore the campaign is intended to run for at least an 18 month period and is open to all residential property landlords – from those that have multiple properties, to single rentals, and from specialist landlords such as student or workforce rentals, to holiday lettings.

In a departure from previous campaigns, the opportunity to come forward voluntarily will remain open throughout the period of the campaign to ensure as many as possible have a chance to come forward.

It is intended that HMRC will be work with a variety of bodies over the next few months to develop tools and guidance to support landlords of all types and help them get their affairs up to date.

Once these information and support tools are in place, from next year HMRC will step up targeted compliance activity across all landlord types meaning any landlord who has not declared all their rental income may be contacted by HMRC. Those landlords will not then be able to make use of the opportunity offered as part of this campaign.

HMRC are clear that they will use information held about property rental in the UK and abroad, along with information already on HMRC‘s digital intelligence system Connect, to identify those in this sector who have not paid what they owe. For those that fail to come forward, higher penalties – or even criminal prosecution – could follow. By coming forward voluntarily, lower penalties may be possible.