HM Revenue and Customs have increasingly adopted a much tougher approach to compliance, after launching numerous task groups pinpointing landlords suspected of not declaring their rental income.
HMRC stated that "out of 1.4 million landlords, just 500,000 are submitting regular returns with the remaining hoping not to get noticed".
Councils have been keen to licence 'buy to let homes', which ensure that landlords are maintaining the property to a reasonable standard and paying their taxes in a timely manner through accreditation schemes.
The key to avoiding HMRC scrutiny on your tax returns and declarations is your record keeping. It is imperative that you keep all available receipts for expenses and documents for the tax year, should HMRC decide to take a closer look at your Return. Many people find this easiest on a spread sheet, showing a monthly income and outgoings categorised from Repairs & Maintenance, Utilities, Management fees etc...
If you let a furnished property, there are additional reliefs available, like wise renting a room in your home or furnished holiday rentals and even converting flats above commercial premises can also have some significant tax advantages.
With the increase in regulations it is key for landlords to inform HMRC about their circumstances, be it profit or loss as soon as possible.
How can PayStream help?
If you don't have the time to complete your own self-assessment tax return our dedicated Tax Team can help.They will ensure that all the relevant admin is completed correctly and the information is submitted on time and in a complaint manner. For more information visit here, email firstname.lastname@example.org or call on 0161 929 6000 (option 3).