In 2013 HMRC launched the Let Property Campaign (LPC) which allows landlords to declare previously undeclared property income or gains. To date over 10,000 landlords have used this voluntary disclosure scheme. This disclosure often leads to a lower penalty of 0-20% of lost HMRC revenue depending on case by case circumstances.
The LPC is aimed for individuals that own residential properties and does not apply to businesses or commercial properties. Once a voluntary disclosure has been submitted landlords have up to 90 days to pay the tax due.
HMRC is cracking down on landlords with undisclosed property income or gains. If a landlord is found to be evading tax and not made a disclosure, they will be fined up to 100% of the tax due and may face criminal proceedings.
HMRC are using an increasing number of channels, such as the Land Registry and Deposit Protection Schemes, for their investigations. Therefore, it is important for landlords to ensure there are no financial irregularities in their finances.
Once HMRC opens an investigation, a voluntary disclosure will no longer be allowed. The LPC does not yet have an end date by which time disclosures should have been made but it will not last forever.
HMRC are introducing severe penalties elsewhere in the tax regime which will be up to 200% of the tax that becomes due. The disclosure will close at some stage and therefore you should act now and speak to a tax specialist if there is a disclosure to be made.
If you have a question or would like more information about LPC then please contact Anthony Middleton for expert advice at firstname.lastname@example.org or 01905 777600.
Anthony specialises in guiding a taxpayer through the complex process of an enquiry by HMRC, mitigating tax and penalties wherever possible.