It is time for landlords to come out of the shadows. HMRC are offering landlords yet to declare and pay tax on their income an opportunity to come forward and face lower penalties as a result. Once the offer has expired, HMRC will use information they have gathered to identify and contact rogue landlords. At that point, penalties of up to 100% of the unpaid tax can be expected.
My advice: it's best to contact HMRC before they contact you. Not only because lower penalties but also because you will have more time to pull together the information you need in orfer to claim deductions against your rent. By the time you factor in mortgage interest, insurance and minor repairs, such as painting and decorating, it may be that only a small profit remains. Plus, you can expect a much smoother ride HMRC generally. If they come to you, then you can expect them to take an interest in other entries on your tax returns, past and future.
In the words of HMRC:
"We appreciate some people will have made honest mistakes, and some may not be fully aware that the rent from a property is taxable, and that is why it always makes sense to talk to us so we can help. It is always cheaper to come forward voluntarily and pay the tax you owe, rather than wait for HMRC to come calling."
If you have rental income to declare then BW Medical Accountants can help you get the best possible deal from HMRC.