Landlords Beware – Letting Agents forced to hand over your details to the Tax Man!
14 June 2018
Are you a private Landlord, and do you declare your rental income to the Tax Man?
This income, whether received weekly or monthly, is a taxable income and should be declared. However, the HM Revenue & Customs (HMRC) are concerned that many landlords are not declaring the correct figures, or not declaring the income at all, and are determined to take action.
The figures released show that only 500,000 Landlords – out of an estimated 1.4milion – declared their rental income in 2013!
As part of their strategy to tackle this unpaid tax, the HMRC are now able to demand that Letting Agents disclose details of rent collected on behalf of private landlords. Letting Agents must comply, and the formal notices requesting the details now come with significant financial penalties for a Letting Agent who fails to comply.
Letting Agents, once served with a formal notice, have 60 days to provide the detail of all rents collected in the year ending April 2018. The financial penalty for failing to comply mounts with each passing day! There are also tougher penalties for providing inaccurate information.
Any person who starts receiving rental income should be reporting that to the HMRC. There are thresholds over which tax is payable, but any new rental property should be declared even where the income falls below the limits.
Here at Curtis Law Solicitors we have expertise in advising Landlords across Lancashire and Greater Manchester, and our expert team are on hand to assist whatever your tenants, the Government or the tax man throws at you.
Iain Blundell, Solicitor leading our Landlord and Tenant department, comments: “There have been so many changes in recent years which affect Landlords, at times it has been difficult to keep up with the changes and proposals! There have been recent changes to Stamp Duty, mortgage interest tax relief, ‘wear and tear’ tax allowances, and a proposed compulsory Ombudsman scheme. Further regulations have also amended the formal Notice requirements, introduced a Tenancy Deposit Scheme and increased the requirement to serve certain prescribed documents at the outset of a tenancy. As we represent a number of landlords across the region, it is easy to sympathise with them when so many changes squeeze the sector in such a short time!”
Are you a landlord? Or Letting Agent? Do you need advice about how to deal with the deluge of recent changes? Need advice on problem tenants, tenancy agreements, or property matters?
We can assist with a wide range of Landlord and Tenant enquiries – please contact us direct on 01254 297130.