Not declared previous Airbnb income to HMRC?

Now is the time to make a disclosure

Online lettings firm Airbnb has announced it will report the earnings of its UK hosts in the years 2017/18 and 2018/19 to HM Revenue & Customs (HMRC) to assist the tax authority with its recovery of outstanding tax.

If you have let property via this platform and have failed to provide a full account of your income to HMRC (where required to), it may be in your interest to make a disclosure now to avoid higher penalties if HMRC instigates an investigation.

What to disclose

Airbnb has previously reported that the average annual earnings from Airbnb by a typical UK host are £3,100, which would lie within the Rent-a-Room relief allowance of £7,500, so would not generate a tax reporting obligation for a host who only lets out part of their main home.

If an individual lets a second or third home that generates income in excess of £1,000 in a tax year, this will create a tax reporting obligation, as it is above the miscellaneous trading income allowance.

How to disclose

Depending on your circumstances, if your income exceeds the Rent-a-Room relief allowance or the miscellaneous trading income allowance and you haven’t reported this to HMRC, it should be disclosed at the earliest opportunity to avoid significant fines. 

If you have already submitted a tax return for 2018/19 it should be amended without delay before 31 January 2021.

If you have omitted some or all of your residential property income for earlier tax years, you should consider disclosing information under HMRC’s Let Property Campaign.

Click here to learn more about the Let Property Campaign

If the let property is located overseas HMRC’s Worldwide Disclosure Facility should be used instead. 

Click here to learn more about the Worldwide Disclosure Facility 

Where full disclosure and payment of the tax is made before HMRC uncovers outstanding taxable income, any additional penalty can be reduced to nil.  

Here to help

If you are at all concerned that you could be affected by Airbnb’s sharing of income data with HMRC and would like to make a disclosure our team can help. 

To find out how we can help you prepare a disclosure or update your records, please contact us.

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