Tax

00ec25

Freespirit38 wrote: »

Ive just joined hence me asking 🙁🙁🙁

fair enough, on that basis your answer is here:
https://www.gov.uk/government/publications/let-property-campaign-your-guide-to-making-a-disclosure/let-property-campaign-your-guide-to-making-a-disclosure

Kim.wigley

Your best option here would be to speak to an accountant. You'll need to show the income you've had over the past 10 years - proof in the form of bank statements is best, in lieu of this I suggest you dig out tenancy agreements etc and anything that states rent owed. Look back at any and all receipts you have relating to the rental. ANYTHING you have spent - repairs on the property, as well as all mortgage payments (you need to know the split between capital and interest - if you can't find statements going back 10 years, look for ALL mortgage documentation you can detailing amounts, interest rates etc).

The good news is that if you lived in the property for a while you will be able to offset a lot of the CGT, and the penalties for a voluntary disclosure are far less than that of one that HMRC find themselves. Declare as soon as you can - make the appointment with an accountant (make sure they're chartered or certified, you can't really afford any cowboys at this stage) - ask for recommendations from friends if you have any that use one (and don't rely on the "my accountant saved me LOADS of tax" rely on the "my accountant was really thorough, explained everything to me and I didn't mind paying a bit more for them").

Freespirit38

Thanks a lot all, I have contacted my accountant and he has contacted HMRC. I’m just gathering all my rental income etc then producing this to the accountant. It’s an honest mistake and wasn’t aware at all as it was below a certain threshold. Anyway, lessons learnt - would my work find out ?

G_M

Why should your work find out? Unless you tell them!


No.

Edi81

Please keep us updated on how it goes.
How much backdated tax, fines you get.

silvercar

Freespirit38 wrote: »

No, HMRC were not aware this was on rental.. guys I really didn’t know. I was occupying the flat myself for a good few years. I’m willing to pay all the back dated tax. I know that I would need to pay CGT - will they ask me where this money has come from ?
I’m going to seek advice soon . ☹️☹️☹️

Please don't feel daunted by the number of negative comments on this thread.

Bottom line is that you didn't do as you should, now you can put it right.

Depending on the size of mortgage on the property, it may be that you have little tax to pay.

hmrc will be more concerned on getting paid, than delving into where the money has come from.

SmashedAvacado

The tone of this thread is quite sour. You of course shoudl have complied with the law, but at least you have realised and you are now wishing to put the record straight.

if you didnt know you had to pay tax, how do you now know that tax is due? Have you worked out what the income was for the property and what was deductable? (for example mortgage interest and agents costs). You should go through the income and expenses carefully over that period for each year and work out what, if anything was profit and potentially taxable before contacting the authorities. If you are not sure how to do that, it might be worth paying someone to help you so that when you speak to the authorities you can give them the full and accurate picture and you will not be on the back foot.

wesleyad

SmashedAvacado wrote: »

The tone of this thread is quite sour. You of course shoudl have complied with the law, but at least you have realised and you are now wishing to put the record straight.

Come on, the OP didn't just have an epiphany and wanted to confess all his sins. He's come to sell the house and realised he could get caught out.

Another thing to think about, if the OP didn't realize he had to pay tax on income (lets be honest, one of the more basic parts of letting) what else have they not done? Gas safety certs, deposit protections, right to rent checks etc.?

But I agree at least he is coming clean and fair play, lots of others would try to dig deeper.

AnotherJoe

Freespirit38 wrote: »

Thanks a lot all, I have contacted my accountant and he has contacted HMRC. I’m just gathering all my rental income etc then producing this to the accountant. It’s an honest mistake and wasn’t aware at all as it was below a certain threshold. Anyway, lessons learnt - would my work find out ?

One thing that occurs - In what function do you employ this accountant? Hopefully not to manage your tax affairs?!

Freespirit38

I have got all the gas safety certs etc, I know that had to be done yearly. The tax issue has come about because of the capital gains tax hence me finding out.. I didn’t even know I had to pay this as I have another property and no it’s not rented. I’m also registered with the landlords associations etc. One thing I’ve done wrong is not paid my tax however I’m taking the steps now to pay it and ofcourse all fines. Hands up - it’s my error but thanks all for the advice.