Airbnb Exchanges Information With HMRC
Have you declared your rental income?
Posted by Helen Beaumont on 14/10/2020 @ 8:00AM
It was recently announced that Airbnb has started to share information with HMRC about the incomes of over 225,000 individuals in the United Kingdom who rent out second homes and spare rooms ...
HMRC will soon be examining the rental income from many Airbnb landlords!
copyright: visivasnc / 123rf
The information Airbnb sent to HMRC includes the names and details of people who register properties and rooms on their site as well as the total income received for both 2017-18 and 2018-19. This deal was struck after HMRC did a deal with them over their own tax bill.
"Potentially, many taxpayers will now face bills and penalties for thousands of pounds!"
Although the Airbnb data allows HMRC to target enquiries into the tax affairs of individuals not declaring lettings income from 2017/18 and 2018/19 it is possible that they could use legislated discover rules to go back many years before that.
A typical UK host received £3,100 which is within the rent-a-room relief allowance of £7,500, so there's no reporting obligation for hosts who let out part of their main home. However, if you let out entire properties that generate income higher than £1,000 in any tax year, then you have to report it.
"If you find yourself in this position, then you need to correct urgently!"
If you have submitted your tax return for 2018/19 already, then it can be corrected right up until the 31st January 2021 deadline. If you owe tax from previous years, then get in touch with HMRC and disclose the additional income under their Let Property campaign. If the property is overseas, the Worldwide Disclosure facility should be used although it does incur higher penalties.
Declare your Airbnb income before HMRC notices, and penalties can potentially be reduced to zero.
Until next time ...
Would you like to know more?
If anything I've written in this blog post resonates with you and you'd like to discover more about the Airbnb/HMRC information transfer and how it may affect you, call me on 01908 774323, leave a comment below or click here to ping over an email and let's see how I can help.
About Helen Beaumont ...
Helen brings the personal tax planning experience of the top 20 tax companies to Essendon. Formerly of MacIntyre Hudson (with 45 offices nationwide), Helen worked at Chancery for more than 10 years before joining Essendon as the personal tax specialist.
Tax Planning can make a considerable difference to your tax liability. Helen has specialist knowledge and experience in tax planning and uses every opportunity to minimise your tax bill is utilised. By analysing your investments, income, profit and expenditures, Helen will provide strategic tax planning expertise that could offer significant savings, whilst delivering clear, honest advice and guidance.
When Helen is not at Essendon she spends time with her young son and likes going on long walks with the family dog.
More blog posts for you to enjoy ...