Let Property Disclosure Campaign

The Let Property Campaign provides landlords who have undeclared income from residential property lettings in the UK or abroad with an opportunity to regularise their affairs by disclosing any outstanding liabilities, whether due to misunderstanding the tax rules or because of deliberate tax evasion.

The campaign was launched in September 2013 and does not currently have an end date. Landlords, who do not avail of the opportunity and are targeted by HMRC, can face penalties of up to 100% of the tax due together with possible criminal prosecution. HMRC’s guidance on the scope of the campaign has been updated. The campaign is an opportunity open to all residential property landlords with undisclosed taxes. The campaign is not suitable for those letting out non-residential properties.

Taxpayers that come forward will benefit from better terms and lower penalties for making a disclosure. Landlords that make an accurate voluntary disclosure are likely to face a maximum penalty of 0%, 10% or 20% depending on the circumstance on top of the tax and interest due. There are higher penalties for offshore liabilities.

There are three main stages to taking part in the campaign, notifying HMRC that you wish to take part, preparing an actual disclosure and making a formal offer together with payment. The campaign is open to all individual landlords renting out residential property. That includes landlords with multiple properties and single rentals as well as specialist landlords with student or workforce rentals. HMRC’s guidance has recently been updated to reflect the start of the new tax year and to include an updated link to the penalties and interest calculator.

Welsh Income Tax takes effect

The start of the 2019-20 tax year marked a fundamental change to the way Income Tax is calculated for people who live in Wales. The new Welsh rates of Income Tax (WRIT) are payable on the non-savings and non-dividend income of those defined as Welsh taxpayers. The revenue from the WRIT will go to the Welsh Government.

The UK government has reduced each of the 3 rates of Income Tax – basic, higher and additional rate – paid by Welsh taxpayers by 10p. The Welsh Government has autonomy to decide the 3 Welsh rates of Income Tax (the Welsh basic rate; the Welsh higher rate; and the Welsh additional rate), which will be added to the reduced UK rates.

In due course, this change could mean that people living in Wales will pay a different rate of Income Tax compared to people in other parts of the UK. However, for the time being, the rates of Income Tax paid by Welsh taxpayers will continue to be the same as those paid by English and Northern Irish taxpayers. This is because the Welsh Government has set the Welsh rates at the same level as in England and Northern Ireland at 10p for 2019-20. 

The definition of a Welsh taxpayer is generally focused on the question of where the taxpayer lives. If the taxpayer has one place of residence or a main residence in Wales, then they will be defined as a Welsh taxpayer.

Welsh taxpayers that pay PAYE should have received a new tax code, starting with C for Cymru. Self-employed taxpayers living in Wales will be required to note their country of residence when they file their 2019-20 tax return.

Job related expenses you can claim against your tax

If you are an employee and use your own money to buy things that you need for your job, you may be able to claim tax relief for the associated costs. It is usually only possible to claim tax relief for the cost of items that are used solely for your work.

There is no tax relief available if your employer pays you back in full for an item you have bought for work. In addition, you cannot claim tax relief if your employer has provided you with a suitable item, but you want a different or upgraded model. For example, you are provided with a mobile phone for your work, but you want to buy a newer and more advanced model and pay for this yourself.

A claim for valid purchases can be made against receipts or as a 'flat rate deduction'. The flat rate deductions are set amounts that HMRC has agreed are typically spent each year by employees in different occupations. They range from £60 to £140 depending on listed occupations. If your occupation isn’t listed, you may still be able to claim a standard annual amount of £60 in tax relief. If you work in certain listed occupations, you could claim back even more.

Expenses where you may also be able to claim tax relief include:

  • if you use your own vehicle for work,
  • travel and overnight expenses,
  • professional fees,
  • costs associated with work from home and
  • buying certain equipment to use as part of your employment.

The rules can be complex. If you pay out for costs that you feel you should be able to claim against your tax, but are unsure if you can make a claim, or how to do this, we can help. Please call.

Estate Agents targeted

HMRC has launched an unannounced crackdown on money laundering regulation non-compliance by estate agents. This clampdown resulted in over 50 visits by HMRC staff to estate agents across England that were suspected of trading without being registered as required under money laundering regulations.

This crackdown includes targeting those who are trading without registering appropriately as well as those who may not be meeting their obligations in line with the money laundering regulations. One of the estate agents visited was fined £215,000.

Commenting on the campaign, John Glen, Economic Secretary to the Treasury, said:

'The vast majority of estate agents play by the rules and help us to crack down on dirty money. But I have zero tolerance for firms prepared to turn a blind eye to the law. Money laundering regulation exists to help protect honest business, so anyone who flaunts the law should know that swift action will be taken.'

HMRC is responsible for supervising a number of business types including Estate Agency Businesses to ensure that they register for anti-money laundering supervision. HMRC supervises more than 11,000 residential and commercial estate agents across the UK. This announcement by HMRC suggests that any estate agency businesses that have fallen through the cracks should ensure that they are properly registered and compliant as a matter urgency.

Tenth anniversary of first Debt Relief Order

Debt Relief Orders (DROs) were first introduced in April 2019. The DROs assist people who have small levels of assets and insufficient surplus income to deal with debts under £20,000. In a news release published by the Insolvency Service we are told that in the last 10 years, more than 254,000 DROs have been approved for people with debts averaging £9,400.

A DRO normally runs for 12 months after which the debts are written off. There are also restrictions during the DRO period, for example restrictions on getting credit of more than £500 without informing the lender of any outstanding DRO.

Paula Hogarth, DRO Service Debt Advice Centre Manager for StepChange Debt Charity, said:

'DROs are a good solution for people with minimal assets and low income who can’t afford to repay their debts. While it’s important that people get proper debt advice, as different circumstances lend themselves to different debt solutions, those people who are eligible for DROs definitely benefit from the relative speed, simplicity and low cost of setting up the solution, as well as usually becoming debt-free a year later.'

Those affected can apply for a DRO through an authorised debt adviser, from organisations such as Citizens Advice, StepChange and PayPlan, who submit applications on-line to the Official Receiver on their client’s behalf.

New guidance on the impact of Brexit on workplaces

Acas has published new general guidance to assist employers and employees in understanding the impact that Brexit may have in their workplace and it gives advice regarding the steps they may want to take before the UK leaves the EU. 

It advises that EU membership can impact workplaces in several ways, such as:

  • providing goods and services to other members of the EU
  • using goods and services provided by other members of the EU
  • employing EU citizens
  • having UK employees work in the EU.

Many UK employment rights also come from EU directives and court decisions about some employment disputes can be made in the EU courts.

The new guidance explains the potential changes to employment law as a result of the UK leaving the EU and it provides links to the government’s technical guidance. It also explains the impact of Brexit on EU citizens working in the UK and it again provides links to government guidance on their rights. Finally, it offers advice to employers when talking to their staff about how they may be affected by Brexit.

Right to work checks for EU nationals after Brexit

The government has published new guidance which confirms that, once the UK leaves the EU and whether this is with a deal or not, there will be no change to the way EU, EEA and Swiss citizens prove their right to work until 1 January 2021. Irish citizens will continue to have the right to work in the UK and prove their right to work as they do now, for example by using their passport.


This means that:



  • employers should continue to conduct right to work checks on all prospective employees, regardless of their nationality, to establish the statutory excuse against payment of a civil penalty for employing illegal workers

  • when carrying out such checks, employers will not need to distinguish between EU, EEA and Swiss citizens and their family members who were resident in the UK before or after the UK leaves the EU

  • until 1 January 2021, EU, EEA and Swiss citizens will continue to be able to prove their right to work in the UK as they do now, for example by showing a passport or national identity card. Alternatively, they may choose to use the Home Office online checking service if they have been granted status under the EU Settlement Scheme, but employers cannot require them to do so. Employers can view the prospective employee’s status through the Home Office online checking service once the individual has provided their date of birth and unique share code

  • employers do not have to check whether existing employees have been granted status under the EU Settlement Scheme

  • as is currently the case, in order for an employer to establish the statutory excuse when employing the non-EU, EEA or Swiss family member of an EU, EEA or Swiss citizen, the prospective employee will need to show Home Office issued documentation. They may choose to use the Home Office online checking service if they hold a biometric residence card or have been granted status under the EU Settlement Scheme.

From 1 January 2021, new guidance will apply for right to work checks and this will be issued by the government in due course.

Capital expenditure for property businesses

There are different rules which apply to different types of capital expenditure for a property business. One of the main areas to consider in deciding whether a repair is a deductible expense is whether it is revenue or capital. Capital expenditure cannot be deducted in computing the profits of a property business, however there are separate reliefs for some capital expenditure.

The cost of land and buildings is capital expenditure, this includes the cost of any new buildings erected after letting has started and any improvements. 

HMRC also list the following additional examples of capital expenses:

  • expenditure which adds to or improves the land or property; for example, converting a disused barn to a holiday home,
  • the cost of refurbishing or repairing a property bought in a derelict or run-down state,
  • expenditure on demolishing a derelict factory to clear space for a new office building; the cost of the new building,
  • the cost of building a car park next to a property that is let,
  • expenditure on a new access road to a property,
  • the cost of a new piece of land next to a property that is let.

In general repairs and trivial capital improvements (incidental to a repair) are usually categorised as revenue expenditure. However, the devil can be in the detail and careful consideration must be given to specific expenses. For example, alterations due to advancements in technology are generally treated as an allowable repair rather than an improvement such as replacing single glazing on windows with double glazing.

Late filing penalty notices delayed

In an agent update published earlier this year HMRC wrote that as part of EU Exit contingency planning, a change would be made to the timings for sending notification of Self Assessment penalties. The £100 penalty notices are normally issued in February but HMRC suggested that they might be delayed as late as the end of April. It has now been confirmed that HMRC began issuing penalty notices earlier this month and all penalty notices are expected to have been sent by 12 April 2019.  

Jon Stride, Co-Chair of the Association of Taxation Technician’s Technical Steering Group, said:

'The ATT is pleased that HMRC have now started to issue penalty notices and have not delayed the exercise to the end of April, which was originally a possibility. However, it will take HMRC until 12 April 2019 to issue all the penalty letters. This gives taxpayers a little over two weeks to submit their return before the daily penalty regime commences.'

If you do not file and pay before 1 May 2019 then you will face far greater penalties. A daily penalty of £10 per day, up to a maximum of £900 (90 days) will be charged from 1 May 2019. Further penalties then apply if your return is still outstanding for more than 6 months after the 31 January 2019 filing deadline. From 1 August 2019 you will be charged a penalty of the greater of £300 or 5% of the tax due. If your return still remains outstanding one year after the filing deadline, then further penalties will be charged from 1 February 2020.

Child Benefit Tax Charge

The High Income Child Benefit charge applies to taxpayers whose income exceeds £50,000 in a tax year and who are in receipt of child benefit. The charge claws back the financial benefit of receiving child benefit either by reducing or removing the benefit entirely. 

If you or your partner have exceeded the £50,000 threshold for the first time during the last tax year (2018-19) then you must take action. Where both partners have an income that exceeds £50,000, the charge applies to the partner with the highest income. 

Taxpayers who continue to receive child benefit (and earn over the relevant limits) must pay any tax owed for 2018-19 on or before 31 January 2020. If the partner who needs to pay the tax charge is not currently registered to submit tax returns they must do so by 5 October 2019.

The child benefit charge is levied at the rate of 1% of the full child benefit award for each £100 of income between £50,000 and £60,000. For taxpayers with income above £60,000, the amount of the charge will equal the amount of child benefit received. 

If the High Income Child Benefit charge applies to you or your partner it is usually still worthwhile to claim Child Benefit for your child, as it can help to protect your State Pension and will make sure your child receives a National Insurance number. 

However, you still have the choice: to keep receiving child benefit and pay the tax charge, or you can elect to stop receiving child benefit and not pay the charge.