"The Let Property Campaign (LPC) was launched in 2013. At the outset, it was only intended to last for 18 months, but it was deemed a huge success, and so it still continues to this day. Unlike previous campaigns, there’s no specific date by which taxpayers need to register.
The best advice is to come forward sooner rather than later. It’s no secret that HMRC has vast amounts of data from various sources, which enables them to spot individuals whose affairs are lacking and get in touch with them. The message HMRC is eager to promote is “it’s only a matter of time”.
HMRC gets information from numerous sources.
All this data is fed into HMRC’s Connect computer system. The Connect system has the ability to flag individuals whose tax affairs appear to be lacking. For example, if the data shows that an individual owns several properties and has a buy-to-let mortgage, yet there’s no land and property pages on the submitted tax returns, it doesn’t take much of a leap for HMRC to work out they have probably underpaid tax. HMRC’s usual approach would be to write to the individual and invite them to use the LPC to make a disclosure.
The LPC is a fairly pain free disclosure mechanism. It enables individuals to sort out historic tax issues by contract settlement, draw a line under past non-compliance and move on.
Unlike previous disclosure opportunities, there are unfortunately no beneficial terms to encourage individuals to use the LPC. The LPC does not offer immunity from prosecution, and 'normal rules apply' in respect of penalties.
Nonetheless, landlords should not feel discouraged from using the LPC if there are unresolved issues. The team at HMRC dealing with LPC disclosures are generally well-versed and appears to be pragmatic when it is necessary to submit estimated figures.
For further information, including case studies, common questions, and detailed guidance, please return to Let Property Campaign or contact our Tax Investigations and Disputes team.