Income from Short-Term Property Letting – HMRC One to Many Letter
HMRC have recently launched a One to Many (OTM) letter campaign relating to income from short-term property letting.
The letter says that HMRC’s records show that the person may have earned income from short-term property lettings and not told HMRC about it. This means they may owe tax on the income. They are requested to complete a ‘Certificate of Tax Position’ within 30 days and tick the box which best describes their circumstances.
- Note that the CIOT has provided guidance to members about how to handle ‘Certificates of Tax Position’ in relation to other HMRC OTM letters – see here and here - particularly the sections headed 'What you should do if a client receives one of these letters from HMRC” and “In view of the serious consequences of making a false declaration, consider very carefully whether your client should sign and return the certificate of tax position'. You may find this guidance useful when deciding how to respond to the ‘short-term property letting’ letters.
HMRC are suggesting that if taxpayers have previously undeclared income to disclose they must use HMRC’s Digital Disclosure Service (DDS) process to disclose the income to HMRC. However, depending on the individual circumstances of the taxpayer, other approaches may be better, for example Code of Practice 9 where fraud is suspected.
The letters have been copied to the taxpayer’s authorised agent if they have one.
A copy of the letter is provided below.
HMRC have provided us with the following additional information about the campaign.
- HMRC are working with online providers for short-term lettings, such as Airbnb, to help their customers to understand how much tax they should be paying and help them get it right first time.
- A small number of people who might have earned income from short-term property letting will receive the letter between February and March 2023.
- HMRC started to issue the letters during the week commencing 6 February 2023.