I have a new client who has been renting out a small residential property for just over 20 years – the rent was approximately £3 000 a year.
He hasn’t filled in any tax returns during this time and he has been a higher rate taxpayer the entire time. He has no knowledge of tax and mistakenly believed that because the rent was about the same as his mortgage he didn’t have to pay anything. The interest on the mortgage was around £1 000 a year. I want to bring his tax affairs up to date with the smallest amount of tax and penalties possible but trying to get the information is very difficult – his records only go back a few years.
My understanding is that HMRC will be relatively lenient with an unprompted declaration but I have never dealt with anything that goes back this far –...
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