Let Property Campaign(LPC) - Rental Tax Disclosure Case Study

HMRC launched the LPC over three years ago and there is no current end date for the facility such has been the volume of disclosures.

At Forths, we have prepared and submitted many LPC disclosures to HMRC.

We were approached by a client who had fallen into the accidental landlord category when she had moved in with her partner and decided to let out her previous residence. Initially unaware of the tax rules around declaring income from property to HMRC. At work, the client heard a colleague mention tax returns and rental tax. 

It was by now a couple of years on from when her first tenant had moved in and she did not know what to do or where to turn. The anxiety of the situation and fear of a HMRC approach lead her to contacting Forths, initially through our website using the contact us section. 

One of our team of disclosure specialists contacted her and spent time discussing her overall tax position but more specifically her rental property. As a solution to bring her tax affairs up to date the Let Property Campaign was advised. 

Reassured by our advice, the client was soon enrolled within the LPC and HMRC were notified of her intension to make a voluntary disclosure. 

The client had managed the property herself and was able to provide evidence of the rents received and expenses incurred. Under guidance, the client was able to identify all the tax allowable expenditure and her profits were accurately calculated. 

Our disclosure team then discussed with the client the level of penalties that would be charged, and a full and complete disclosure including an offer for the calculated liability was made to HMRC all within the 90 day window. 

HMRC then reviewed the disclosure and following a telephone conversation with our team to discuss the penalty behaviours, issued an acceptance of the disclosure. 

As part of the tax catch up process, our tax return preparation team registered the client for Self Assessment and have continued to keep her tax obligations up-to date.