The Let Property Campaign from HMRC has been around for years, providing landlords with an opportunity to report any rental income that was not declared at the time they filed their annual tax return. This initiative has been running for over a decade since its launch in 2013. If you are a landlord, understanding the Let Property Campaign’s disclosure process and potential penalties is essential to mitigate getting hit with disclosure penalties by HMRC if you choose not to take advantage of this opportunity to be compliant.
What is the HMRC Let Property Campaign?
The HMRC Let Property Campaign is designed to help individuals who earn rental income from the UK or overseas, who have not reported all of their rental income. This Campaign allows property owners to correct any mistake made while filing their taxes with the assistance of the HMRC and receive a lower penalty for making that correction.
The HMRC Let Property Campaign was created as part of HMRC’s ongoing commitment to encourage landlords to be compliant with tax laws by providing them with an opportunity to correct previous errors with limited consequences for doing so or facing significant enforcement actions. Landlords who choose not to come forward and later identify discrepancies in their reported tax amounts will likely face substantial penalties as well as potential civil or criminal prosecution.
Let Property Campaign Disclosure Process
1. Inform HMRC
First, inform HMRC that you are planning to disclose any unpaid tax. You will not need to provide any further financial information to HMRC at this stage; simply a notification is required.
2. Obtain Disclosure Reference
HMRC will give you a unique reference (Disclosure Reference) that will be used for all communication and remittances once HMRC has received your initial notification.
3. Make Full Disclosure
You must submit your full disclosure to HMRC of your let property campaign within 90 days of notifying HMRC, and let HMRC know of any disclosure of:
- All Rental Income That Has Not Been Disclosed.
- Any Other Sources Of Taxable Income.
- Interest On Any Late Payments.
- Any Late Payment Penalties Running To The Date Of This Submission.
4. Paying What You Owe
Submit a payment with your entire disclosure at the same time. If you are unable to make payment in full, you will need to make alternative arrangements for making the payment by the due date.
5. HMRC Review
HMRC will review your entire disclosure for completeness and accuracy, and will typically accept the entire disclosure if it is both complete and accurate. If your disclosure is not complete, it will generally not be accepted.
Let Property Campaign Penalties
Penalties under the campaign depend on your behaviour, disclosure timing, and cooperation with HMRC.
Standard Penalty Ranges
- UK Income: Up to 100% of unpaid tax
- Offshore Income: Up to 200% of unpaid tax
These penalties are calculated as a percentage of the unpaid tax and vary based on whether the error was:
- Careless
- Deliberate
- Deliberate and concealed
| Behaviour | Unprompted (Voluntary) | Prompted (After HMRC Contact) |
|---|---|---|
| Reasonable care | 0% | 0% |
| Careless (within 12 months) | 0%–30% | 10%–30% |
| Careless (over 12 months) | 10%–30% | 20%–30% |
| Deliberate | 20%–70% | 35%–70% |
| Deliberate & concealed | 30%–100% | 50%–100% |
Penalty Reductions
The main advantage of participating in the disclosure campaign is the potential for lower penalties for making a voluntary disclosure:
- Penalties for unprompted disclosures will be lower than for prompted disclosures.
- In the event you cooperate fully and provide accurate information to HMRC, you could receive the maximum reduction in your penalties.
Some individuals may have their penalties reduced to zero if they can show that they exercised reasonable care but made an honest mistake.
Interest and Additional Charges
Along with penalties, HMRC applies interest charges for overdue tax payments calculated daily from the due date until paid. Anyone who fails to account for their income or expenses accurately will be subject to further penalties of up to £3,000.
Risks of Not Using the Let Property Campaign
Failing to respond to the campaign may result in:
- Increased penalties if HMRC discovers any undeclared income in the future
- Being placed on HMRC’s list of deliberate defaulters
- A criminal investigation or prosecution in serious cases
HMRC are increasingly using data and compliance checks to identify landlords who have not declared their rental income, resulting in the collection of millions of pounds each year through recovering this money from landlords.
Benefits of Voluntary Disclosure
Choosing to disclose under the Let Property Campaign offers several advantages:
- Lower penalties and interest than if they were to be subject to a normal HMRC investigation.
- All matters will be resolved under agreed terms, so there is certainty that it is all over once agreed.
- There will be no public naming and shaming of you as an intentional defaulter if you fully cooperate with HMRC.
- There will be an opportunity to resolve other tax problems (HMRC will refer them to other internal departments).
- You will be provided with protection from being scrutinised for the periods disclosed, provided future returns submitted are accurate and that proper records are retained (failing to retain proper records can lead to separate penalties of £3,000 per failure).
Many Tax advisers are recommending the campaign as it follows a structured process and mitigates penalties, particularly with the increased use of data analytics by HMRC in 2025/26.
Common Pitfalls and Practical Tips
- As soon as you acknowledge tax owed, do not delay in notifying HMRC; the 90-day timeframe will then begin to run. If your correction is incomplete or materially inaccurate, it is likely the submission will be rejected.
- Make sure your working papers contain sufficient detail even when you are using an estimate, as HMRC may request an explanation of your calculations.
- If you have a case of greater than one property or if you are dealing with offshore elements or excessive liabilities, get help from a professional to reduce penalties and avoid errors in calculation.
- The current year income is not included in the campaign, and will not provide protection from prosecution in the event of any criminal conduct.
How Reflex Accounting Supports You
Reflex Accounting specialises in guiding landlords through the HMRC Let Property Campaign, helping you correct past errors while avoiding costly mistakes. We carefully review your rental income history, identify any undeclared income, and calculate the tax due so your disclosure to HMRC is complete, accurate, and compliant.
Our team also focuses on minimising penalties by presenting your disclosure in the best possible way and securing any available penalty reductions. Reflex Accounting deals directly with HMRC on your behalf, removing the stress of handling tax authorities yourself. If you cannot pay everything at once, we help you agree affordable payment arrangements, so you can get back on track with HMRC without unnecessary financial pressure.
For expert support with your Let Property Campaign disclosure, please contact Reflex Accounting today on +44 121 262 1528 or email info@reflexaccounting.co.uk.
FAQs
Does the campaign apply to limited companies or commercial property?
The let property campaign is mainly for individual landlords with residential rental income. It typically does not apply to limited companies or purely commercial properties, which follow different reporting rules under HM Revenue & Customs.
Why should I disclose through the Let Property Campaign instead of waiting for HMRC to contact me?
Making a voluntary disclosure through the HMRC let property campaign usually results in lower penalties and a smoother process. If HM Revenue & Customs contacts you first, penalties increase and the risk of a formal investigation becomes much higher.
Will I definitely pay a penalty under the Let Property Campaign?
In most cases, some level of let property campaign penalties will apply. However, these can be significantly reduced depending on your behaviour, and in genuine situations where reasonable care was taken, penalties may be minimal or even zero.
How can an accountant help with a Let Property Campaign disclosure?
An accountant ensures your let property campaign disclosure is accurate and complete. They calculate your tax correctly, identify allowable expenses, minimise penalties, and handle communication with HM Revenue & Customs, making the process far more efficient and less stressful.
