RLA blames the increase on honest mistakes caused by the increasingly complex tax rules facing landlords, but HMRC is also ramping up its efforts to get collect revenue.

The number of landlords who have admitted to under-declaring their rental income increased by 28% last year when compared to the year before, a Freedom of Information (FOI) request submitted to HMRC has revealed.

During 2019 some 11,129 landlords were found to have under-paid or not declared rental income at all, up from 8,704 in 2018. HMRC has subsequently reclaimed £44.7 million from landlords, an increase of 36% from £32.8 million during 2018.

The FOI request, which was submitted by the Telegraph newspaper, also found that HMRC had fined accounting professionals dealing with landlords’ tax affairs a total of £7.6m, another rise of 36% compared with the 2018 fines.

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These latest figures are part of HMRC’s Let Property campaign which has been running since 2013 and targets tax-evading landlords.

But the Residential Landlords’ Association is keen to point out that many of the people involved have not been deliberately avoiding tax, but rather making honest mistakes when submitting their income tax returns.

Its spokesman David Smith told The Telegraph that the level of mistakes was not surprising “given a number of recent changes and an increasingly complex tax system affecting rented housing.”

HMRC’s Let Property campaign enables landlords who think they have not declared, or under-declared income from rental property in the UK or overseas to ‘get up to date with their tax affairs’ as HMRC euphemistically puts it, without having to pay a huge fine. The campaign was introduced as a short-term measure but has since been made permanent.


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