HMRC receives information about landlords from third parties and other sources, including tenancy deposit schemes. It is writing to landlords where this data does not tally with information filed by the taxpayer. The letter encourages taxpayers to disclose any income from let property. It also reminds them to declare any property disposals for capital gains tax purposes, and that they may have responsibilities to meet under MTD for income tax.

If you receive such a letter, or you have received income from renting out or selling a property that we are unaware of, please let us know.

If a friend or a relative receives such a letter, they should check the figures they have reported to HMRC. There is guidance on GOV.UK on the tax implications of receiving property income including the £1,000 tax-free allowance.

Having considered their position, they should then take the following action:

• if they have income to declare from renting out land and/or property they should disclose this to HMRC by following the steps in the letter, noting the deadlines set out in the letter;
• if they have nothing to declare, they should still contact HMRC using the details given in the letter to confirm this.

If HMRC does not receive a response to the letter, it may open a compliance check or criminal investigation. In this scenario, any disclosures made by the taxpayer during the check or investigation will be treated as prompted. This could result in higher penalties being charged.