If you’re a landlord with undisclosed rental income, the Let Property Campaign (LPC) is an opportunity to come forward and regularise your tax affairs with HMRC. By participating in this campaign, you can potentially reduce the penalties and interest charges associated with late or non-disclosure of rental income. However, understanding the penalty structure of the Let Property Campaign is crucial to making an informed decision.
What is the Let Property Campaign?
The Let Property Campaign is an initiative by HMRC aimed at landlords who have not reported their rental income. This campaign allows landlords to voluntarily disclose undeclared rental income and pay any outstanding taxes, often with reduced penalties.
The Importance of Disclosure
Failing to disclose rental income can result in significant penalties and interest charges if HMRC discovers the discrepancy through its investigations. By voluntarily coming forward through the Let Property Campaign, landlords can benefit from more favourable terms.
Penalty Structure of the Let Property Campaign
When you disclose your rental income through the Let Property Campaign, HMRC considers several factors to determine the penalties and interest charges:
Timing of Disclosure
§ Unprompted Disclosure – If you disclose your undeclared income before HMRC contacts you, it’s considered an unprompted disclosure. It often results in lower penalties.
§ Prompted Disclosure – If HMRC has already started an inquiry and you then decide to disclose, this is considered a prompted disclosure, usually resulting in higher penalties.
Behavioural Considerations
§ Careless Mistakes – If the undeclared income was due to a careless mistake, such as an error in record-keeping, the penalties are generally lower.
§ Deliberate Non-Disclosure – If you deliberately choose not to disclose the income, the penalties are significantly higher.
Penalty for Failure to Notify

Steps to Minimise Penalties
To ensure you get the best possible outcome from the Let Property Campaign, consider the following steps:
§ Maintain Accurate Records – Keep detailed and accurate records of all rental income and expenses.
§ Seek Professional Advice – Consulting a tax advisor can help you navigate the complexities of the disclosure process and optimise your submission.
§ Act Promptly – The sooner you disclose, the better the terms you’re likely to receive.
Conclusion
Participating in the Let Property Campaign can be a beneficial move for landlords with undeclared rental income. By understanding the penalty structure, you can make an informed decision and potentially reduce the financial impact. If you believe you may have rental income to disclose, it’s wise to act promptly and consider seeking professional advice from UK Property Accountants to guide you through the process.
By leveraging the Let Property Campaign, you can achieve peace of mind and ensure your tax affairs are in order. For more information on the campaign and how to proceed, consult HMRC’s official guidelines or speak to a qualified tax professional.