What is the Let Property Campaign service and who can use it?

In the dynamic world of property rentals, landlords often find themselves immersed in a sea of legal and financial obligations. With the UK’s tax legislation continually evolving, it can be challenging to report rental income accurately. However, the Let Property Campaign service allows landlords to rectify past tax discrepancies. In this blog, we delve into the Let Property Campaign, exploring its purpose, benefits, and who can use it.

What is the Let Property Campaign service?

The Let Property Campaign service was introduced by HM Revenue and Customs (HMRC) as a voluntary disclosure service for landlords who have previously failed to declare their rental income or have paid less tax than they owed. The disclosure service aims to encourage landlords to come forward and correct their tax affairs voluntarily, helping them mitigate hefty penalties and potential prosecution. Landlords may also be ‘prompted’ by HMRC to use the system if they’ve received a letter.

Benefits of the Let Property Campaign service

By voluntarily disclosing any unpaid tax, landlords are typically liable to reduced penalties under the Let Property Campaign service versus those imposed if HMRC discover the underpaid tax independently.

The Let Property Campaign service also offers a simplified procedure for landlords to bring their tax affairs up to date. By disclosing their rental income voluntarily, landlords avoid the lengthy and stressful investigations that may arise from non-compliance.

Who can use the Let Property Campaign service?

The service is available to various individuals with rental income, such as individual landlords. Regardless of whether you own one or multiple properties, the Let Property Campaign service can be an excellent opportunity to rectify any past tax discrepancies. UK resident individual landlords can also use the service to disclose any foreign rental profits.

The service is also available for use by those renting a room in their own home to a lodger where rents exceed the Rent a Room scheme threshold, and by specialist landlords with student or workforce rentals.

Non-resident landlords can also use the service. Even if you live overseas but have rental income from properties in the UK, you can still use the Let Property Campaign service.

It covers not only long-term residential rentals but also holiday lettings. If you have rental income from furnished holiday accommodation, participation in the campaign can resolve any tax underpayments.

Using the service

The first step to take when you’ve identified a past tax discrepancy is to collate records relating to the income and expenditure from your rental property or properties. Your accountant will be able to help calculate your profits and tax liability based on the records you provide.

Next, you should notify HMRC of your intention to disclose under the Let Property Campaign service. This is done online, and again, this is something your accountant can help with. This should be done as soon as possible. It’s important to make sure you come forward to HMRC as soon as you can after becoming aware of the discrepancy, as this will help you to mitigate significant penalties and investigations.

Once HMRC are notified, they’ll send you a letter detailing how to complete the disclosure itself. You’ll have 90 days from the date of the letter to complete the disclosure and pay what you owe. Taxpayers must ‘self-assess’ interest and penalties on top of any tax liabilities, so it’s important to seek professional advice to make sure this is right.

Once HMRC receive the information and they’re satisfied a full disclosure has been made, they will aim to accept the disclosure as quickly as possible.

Need help?

For further information, please get in touch with your usual Larking Gowen contact who’ll be able to help you to rectify past discrepancies using the service, as well as help you to make sure that your tax affairs are compliant, going forward. You can find contact details on the Our People section of the Larking Gowen website. Alternatively, call 0330 024 0888 or email enquiry@larking-gowen.co.uk.

Emma Walker