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Airbnb Landlords Income and HMRC

Mike Wakeford

You may have seen recent headlines about the tax affairs of Airbnb in the UK and that HMRC have charged them with an additional £1.8 million of tax following an investigation. If you are a UK citizen, or a general fan of tax payments you may think that sounds good as the company didn’t seem to be paying enough tax. But how will this change affect Airbnb hosts? 

The answer to that question, is that a note included in the recently filed 2019 accounts of Airbnb UK states that the company is sharing information about income received through the company in the tax years 2017/18 and 2018/19 by the many thousands of Airbnb hosts across the UK.  Landlords are being warned by the tax authorities that they could face thousands of pounds worth of bills in back taxes and fines if they have failed to declare income from renting all or part of their homes or other properties they own. 

HMRC will have varying lengths of time to check the records of individuals they are interested in, depending on whether any undeclared income is regarded as being the result of an innocent error, careless behaviour or deliberate evasion.  Depending what factors apply, the period for which back tax, interest and penalties will be sought ranges from four years up to 20 years. 

HMRC have indicated that they will be looking at the information they have been provided with throughout the 2021/22 tax year.  The penalties that will be charged for late notification of income are lower if they are made voluntarily before HMRC open an enquiry themselves, so it is always better to approach HMRC before they contact you if you have received an income from letting via Airbnb that you have not already declared.

If you receive income from any let property where the rental income is collected by an agent, they are already obliged to provide HMRC with details of income received by them for the landlords they act for, and this latest move sees this requirement extended to Airbnb hosts.

We are able to help you with declaring any previously undisclosed income to HMRC, and please contact your local Moore South office for advice and assistance in this area.