HMRC amnesty on rental income
The HMRC are focussing on the lettings sector in terms of rental income and taxation associated with that income. As a result, it is highly likely over the last few months that you will have received correspondence regarding the tax you pay on the property or properties you let.
Last year there was a focus on Capital Gains Tax (CGT). For landlords who sold a property other than their main home, there was an amnesty on fines for those who should have paid CGT and came forward within 60 days of having done so. Now the government has introduced a second amnesty for landlords and this is to allow landlords to declare excess net income which should have been taxed.
What impact will this have on landlords?
By law, lettings agents have to advise HMRC of properties let and managed. This information was requested from us and we provided a response at the end of March 2014.
Therefore, if you already fill in the relevant forms for HMRC every year and declare all income and earnings, they should be aware of the net gains you are making and tax you accordingly and you shouldn’t need to do anything further.
If you are not yet providing these details, it would be wise to urgently seek the advice of a property tax expert. Please contact your local Savills office as they will be able to locate one for you.