Undeclared income

13 December 2006

Issue: 4088 / Categories: Forum & Feedback

I have had a couple referred to me who jointly own their marital home which they purchased in 1990. In 1998, they were given work-related accommodation, and so they let the marital home. They had been employees all their lives and had no idea on tax matters. It is only just being suggested to them that they should have been declaring the rental income on the property and completing tax returns for the year ended

I have had a couple referred to me who jointly own their marital home which they purchased in 1990. In 1998 they were given work-related accommodation and so they let the marital home. They had been employees all their lives and had no idea on tax matters. It is only just being suggested to them that they should have been declaring the rental income on the property and completing tax returns for the year ended
5 April 1999 and onwards. Because there has been no property movement HMRC remains blissfully unaware that they have this rental income. A quick calculation showed the tax outstanding to be about £1 000 per year for eight years. However when one starts looking at the various penalties involved the ultimate bill could exceed £30 000.
First there is a 5% surcharge because for seven of the years...

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