Taxman targets buy to let

HM Revenue and Customs is increasingly targeting ‘buy to let’ landlords who are not declaring their rental income on their properties, tax experts at North West-based accountants and business advisor WNJ are warning.

The taxman is in the middle of contacting 40,000 landlords in an 18-month campaign asking them to make contact regarding their tax affairs within 30 days – or face action.

Its estimates indicate that up to £500million in tax is lost each year as a result of the failure of hundreds of thousands of landlords to account for rental income and capital gains arising on investment properties.

The training is in the form of a series of short modules, including when and how property letting starts, and what to do; the various types of property income and how they are taxed and PAYE and VAT obligations.

“HMRC make use of a vast array of information resources to identify those failing to report their taxable income and gains, including local council records, letting agents’ records, land registry entries and even social media.

The Let Property campaign is designed to encourage landlords to review their tax affairs and come forward if they have failed to disclose their reportable income and gains accurately.

“These should therefore be much more lenient where a taxpayer voluntarily discloses an error than if HMRC approach them.