By using this website, you agree to our use of cookies to enhance your experience.
Graham Awards


HMRC may add tax checks to private rental licensing schemes

HM Revenue & Customs has launched a consultation on adding tax checks to private rental sector licensing schemes - in other words, checking up on landlords to ensure they are paying their fair share of tax.

The government’s consultation document says the majority of UK taxpayers pay what they owe, but a small minority are active in the ‘hidden economy’ - tax dodging, in other words. 

It says the best way to tackle non-compliance is to prevent it happening in the first place, while cracking down on the minority who do break the rules.


The 37-page document includes a possibility that applying for HMO licences could also involve ensuring applicants are compliant with tax laws before renting out properties. 

The consultation says the government “values the private rented sector and wants to see a strong, healthy and vibrant market, which meets housing needs in a professional way. This includes ensuring that landlords are reporting and paying the tax they owe.”

HMRC says there are four key points:

1. First-time applicants may be told to ensure that they understand their taxable status and are able to register as soon as possible after they begin trading as a landlord;

2. Those renewing licences will have checks carried out to confirm and provide evidence of their tax-registration status;

3. The emphasis would be put on the landlord applying for a licence to ensure they show  proof of tax registration and payment;

4. Licensing authorities - usually local councils - would not be expected to conduct tax checks but would be expected to ensure representatives see evidence of tax registration before the granting of new or renewed licenses. 

The closing date for consultation is March 2 - you can see the full HMRC document here.

Poll: Is this a good idea - or will it simply deter landlords from buying licences


  • Angus Shield

    Err, are they not already doing something akin to this?

    We received, yesterday, a letter from HMRC notifying us that ……….” Within the next 10 months I will be sending you a statutory notice under paragraph 18 Schedule 23 Finance Act 2011 requiring you to send me a return on information” ………

    Basically, a list of our UK clients we have collected rent for.

    We refer to it as the ‘anti-FICO’ as we submit overseas Landlord information (under the FICO NRL1 approval scheme).

  • icon

    Many HMO's are run privately, not licensed by the district councils and probably are a large proportion of the rogue landlords, avoiding taxes too let alone H&S rules, migrant rules et al. A shame more effort can't be made to identify and investigate HMO's and dodgy flats but there we are.

  • icon

    I have paid tax from day one on my BTL 's my reward? = taxed on my legal( what should be ,allowable )interest paid on my mortgages!
    Thankyou tax man.
    This will turn out to be discrimination ! all businesses can claim expenses,finance costs(interest)
    you have failed us and ( I feel will have to refund us )

  • Roger Frith

    Roger Frith.

    Likewise as Angus has said, we have been doing this annually for the last 4 years, under threats of huge fines if we do not abide by the rules. So it is nothing new to most Letting Agents.


Please login to comment

MovePal MovePal MovePal
sign up