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14/7/25 8:13 pm
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Voluntary tax disclosures from landlords who have underpaid on their rental income netted HMRC an extra £107 million last year.
Money paid back under the tax office’s Let Property Campaign has soared in recent years, from £39 million in 2021-22, according to data revealed in a freedom of information request by accountancy firm Price Bailey. HMRC recovered £13,713 in tax per disclosure in 2024/25, by far the highest amount since the campaign’s inception, and up from £7,401 in 2021-22.
While the tax yield has grown, the number of voluntary disclosures has fallen since 2022-23 from about 11,000 to 7,800 – suggesting that landlords are coming forward with higher tax bills.
Tax investigations partner at Price Bailey, Andrew Park, (pictured) tells LandlordZONE: “I attribute that to the way taxable rental profits have risen as rents have risen but tax relief for mortgage interest relief has gradually been withdrawn. There’s a bit of a paradox whereby many landlords are making smaller real economic profits – if any at all now - whilst their taxable so-called ‘profits’ after disallowing finance costs have got bigger and bigger.”
He believes the reason there seems to be fewer disclosures might be that there are still quite a lot of people ‘nudged’ during the year to 31st March 2025 who haven’t yet submitted their disclosure, but will do so.
Park warns that HMRC has access to huge and expanding amounts of information which its computer systems trawl through looking for ‘phantom’ landlords. “For instance, they look for people listed on Land Registry as owning multiple properties and they obtain client data from Airbnb and other letting agents - and HMRC are getting better and better at finding people.”
Under the scheme, HMRC can claw back up to 20 years of underpaid tax, fine landlords up to 100% of any owed tax, or 200% for cash held offshore. In cases where the landlord is found to have made a genuine error with their tax return, HMRC will only reclaim up to six years of underpaid tax and will reduce or wipe the fine.
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