The taxman is writing to Britons it suspects are guilty of failing to declare taxable income received from property.
The letter includes a warning to provide information on any income received through rent from letting out a property, or the income received from the sale of a second property.
There is a deadline of 30 days to respond to the letter, while the HMRC is warning of penalties who fail to own up to the cash they have received.
If the taxpayer has income and/or gains to declare, they are asked to contact HMRC by calling the number given in the letter or by using HMRC’s online service. This should be done within 30 days of the date of the letter.
HMRC will then provide a payment reference number (PRN) and the individual will have 90 days from receiving the PRN to declare their income and pay any tax owed.
Even if the taxpayer believes that they do not have anything to declare, they are asked to call or email HMRC using the contact details provided in the letter.
Again, this should be done within 30 days of the date of the letter. HMRC says that it will open a compliance check if the person fails to respond to the letter.
The letter warns that any delays in responding can increase the penalties, while there is also a risk that interest will be applied to any tax that is paid late.
A template of the letter states: “We have information that shows you’ve received income from property lettings.
“You may have to pay tax on your income from property if you:
* let out property
* are a landlord
* have been a landlord.
“If you haven’t told us about this income, you may owe tax.”
It adds: “If you’ve disposed of property that you received rental income from in the past, you need to make sure you’ve declared it to us. You may have to pay Capital Gains Tax.”
The letter comes with a warning and states: “If you don’t declare any income or contact us, we’ll open a compliance check and can charge you extra penalties.
“If you didn’t tell us you may owe tax, or didn’t tell us on time, we’ll treat any disclosure you make from now on relating to the issue above as prompted.
“This may affect any penalties you have to pay. We also charge interest daily on late tax payments. Paying any tax you owe sooner will reduce the amount of interest you’ll have to pay.”
A series of factsheets are available to help people understand the process, the rights and the penalties. These can be found via the GOV.UK website and searching for ‘Compliance factsheets’. Alternatively you can call 0300 123 0998.
