Being a landlord isn’t just about managing tenants and maintaining properties—it also means staying compliant with tax regulations. If you are an individual and have been renting out residential property in the UK and haven’t declared all your income, HMRC’s Let Property Campaign is your chance to set things straight.
By notifying HMRC now, you’ll have 90 days to calculate and pay any outstanding tax. Waiting until HMRC finds out on its own could lead to higher penalties—or even legal action. Taking action today can help you avoid unnecessary trouble down the line.
How to Make a Notification and Disclosure of Rental Income to HMRC
You can either choose to disclose the information yourself or hire an agent to handle it for you. Since tax matters can be complicated, and the process might feel overwhelming, having a professional by your side can make things much easier.
Notify HMRC of your intention to make a Disclosure
As soon as you realise that you owe tax on your rental income, you must inform HMRC of your intention to make a disclosure via HMRC’s Digital Disclosure Service. The first step is to notify HMRC, but at this stage, you don’t need to provide details of your undisclosed income or the amount you owe. You can do this voluntarily once you become aware or by responding to a nudge letter from HMRC.
Once you’ve submitted your notification, HMRC will send you a unique disclosure reference number (DRN) to use for all communication regarding the Let Property Campaign, along with a payment reference number to settle your tax liability.
Important
Each disclosure must be made individually. For example, if both a husband and wife have undisclosed rental income from a jointly owned rental property, they must each submit separate notifications and disclosures for their share of the income.
Disclose your undeclared letting income
Once you receive your disclosure reference number, you can proceed with your disclosure. However, you must complete it within 90 days of receiving your notification acknowledgement.
Your disclosure should cover all the undeclared rental income, unpaid tax from the period when it was not previously declared and appropriate applicable penalties rate. When submitting your disclosure, you’re also required to pay the full amount you owe.
If you’re unable to pay the full amount by the deadline, you must contact HMRC in advance to arrange a payment plan using the link here If you cannot pay your tax bill on time: Setting up a payment plan.
It’s crucial to ensure that HMRC receives both your disclosure and payment by the deadline stated in your notification acknowledgment. Acting early can help you avoid additional penalties or complications.
How many years to include in your disclosure?
If you’re taking part in the Let Property Campaign, you already understand why your rental income wasn’t reported to HMRC in the first place.
As a landlord, you’re required to inform HMRC about your letting income by 5 October following the end of the relevant tax year. For example, if your rental income is from the 2023/24 tax year, you must notify HMRC by 5 October 2024 and submit your Self-Assessment tax return by 31 January 2025.
If you miss these deadlines, the amount you’ll need to pay will depend on your specific situation described below:
You have taken reasonable Care
If you registered for a Self-Assessment tax return on time and made every effort to keep your tax affairs in order but still ended up underpaying, HMRC will only require you to settle what you owe for a maximum of four years.
To stay compliant moving forward, ensure that:
- Your tax returns for the current and future years are accurate and submitted on time.
- Any outstanding tax from the previous year is reported in the relevant return by the deadline.
- You complete your disclosure and pay HMRC for the three tax years before that period.
You have not taken reasonable Care
If you registered for a Self-Assessment tax return by the appropriate deadline but you have paid too little because you were careless, you’ll have to pay HMRC what you owe for a maximum of 6 years. This means you:
- will need to make sure that your tax affairs for the current and later tax years are accurately reported on tax returns by the appropriate deadlines
- will need to make sure that your tax affairs for the year prior to the current tax year are reported on the tax return that was issued to you for that year by the appropriate deadline
- have to complete the disclosure form and pay HMRC what you owe for the 5 years prior to this
You deliberately misled HMRC about this income
If you have deliberately paid too little tax, you’ll have to pay HMRC what you owe for a maximum of 20 years.
HMRC expects most people to have to pay a maximum of 6 years but there will be some who need to pay more. These are people who have either:
- deliberately told HMRC they have earned less than they have
- not told HMRC anything at all about their income
Conclusion
The Let Property Campaign offers landlords a chance to correct undeclared rental income with reduced penalties. By notifying HMRC and disclosing your income within 90 days, you can settle outstanding tax and avoid legal risks. Acting now ensures compliance and prevents future complications—don’t wait for HMRC to contact you, take control today.
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