LANDLORDS TARGETED OVER UNDECLARED INCOME FROM RESIDENTIAL PROPERTY
Released On 1st Dec 2022
Landlords are being targeted by HM Revenue & Customs (HMRC) over what appears to be undeclared rental income or income related to residential property.
HMRC’s Wealthy External Forum sent 606 letters to landlords who have submitted deposits into a tenancy deposit scheme, questioning them about understating their rental income.
Landlords and letting agents are required by law to protect tenant deposits on rental property in a Government-approved tenancy deposit scheme.
The Housing Act 2004 law applies to landlords who let under assured shorthold tenancies, usually used to let residential properties.
Check and correct tax return
The HMRC nudge letters are based on information received from other Governmental departments, banks or, in this case, the Tenancy Deposit Scheme (TDS).
HMRC believes it will be able to estimate the total rental income for the year, based on the level of the deposits placed within the scheme. A deposit usually amounts to four to five weeks of gross rent.
