HM Revenue & Customs is proposing that letting agents file more tax data about property income earned by their landlord clients.
In highly detailed paperwork released after the Budget, HMRC explains that it’s embarking on a consultation to see how agents can best do this on a regular and routine basis.
Currently the taxman pro-actively issues a notice seeking landlord tax rental data from a lettings agency or a tenancy deposit scheme – some 10,000 such notices are issued annually.
But now it wants rental income data reports to be made by agents and tenancy deposit schemes on a regular basis.
The consultation suggests letting agents do not have a record of filing complete information even when requested under the current system. It says: “HMRC continues to receive data that is incomplete, inaccurate or inconsistent. In some cases, information that could support improved data matching and tax administration is not collected consistently across the sector.”
HMRC wants to remedy that by insisting that agents pro-actively file reports in what it calls a structured digital format, to make validation and compliance easier to undertake.
HMRC says in the consultation: “Improved data quality would enable HMRC to deliver better services for taxpayers while strengthening compliance activity.
“For example, HMRC could provide more personalised support for self assessment customers, automatically identify and register those who need to complete a return, and improve the accuracy of tax forecasts and compliance interventions.”
In an acknowledgement that letting agents already undertake considerable compliance red tape, the consultation adds: “The government seeks views on how future requirements can be designed proportionately, with appropriate lead-in time, guidance, and support to ensure the proposals achieve their objectives while minimising new burdens.”
The consultation closes on January 20 2027, and you can see it here: https://www.gov.uk/government/consultations/improving-property-income-data-reporting/improving-property-income-data-reporting-design-and-implementation#assessment-of-impacts
