Penalties for Landlords

Bookkeeping Services for Financial Records

Reporting to HMRC

When you start renting out a property, you must tell HMRC and you may have to pay tax return. If you don’t, you could be charged a penalty. You must report income from property rental if you receive:

 

  • £2,500 or more from the property after deducting allowable expenses
  • £10,000 or more from the property before deducting allowable expenses

If your property income does not meet either of these thresholds, you must still call HMRC and possibly the Tax Credits Office, to advise them of your new income.

Landlords who come forward voluntarily will still have to pay a penalty of up to 20% – plus the tax and interest – but this compares with penalties of up to 100% and even the possibility of prosecution.

 

Leave a Reply

Your email address will not be published. Required fields are marked *