Short-Term Letting

Debate between Lord Palmer of Childs Hill and Lord Young of Cookham

Thursday 26th April 2018 Lords Chamber

[Lord Young of Cookham]

The noble Lord raises an important issue about the non-declaration of income from rented property. In 2013, HMRC launched an initiative to address the so-called tax gap. As a result, some 26,000 landlords came forward to self-correct undeclared income and £150 million had been collected by August 2017. Some 45,000 of what HMRC calls “nudge letters” have been sent out where there is third-party evidence of undeclared income. HMRC has a fairly sophisticated IT system to collect data from a variety of sources to track down income. Of course, it can approach local authorities for information on, for example, housing benefit or other information they may have in order to safeguard the revenue.

[Lord Palmer of Childs Hill (LD)]

My Lords, the Minister seems to have focused the question on tax avoidance or tax evasion, when the focus of the Question from the noble Baroness, Lady Gardner, is on the 90-day limit and enforcement. Can the Minister tell your Lordships’ House which local authorities are enforcing this in London and which are not? It is all very well discussing it, but if there is no enforcement, there is no use.

[Lord Young of Cookham]

Responsibility for enforcement rests, as the noble Lord recognises, with local authorities. They have quite wide powers of enforcement, and potentially there is a £20,000 fine for breach of the 90-day rule if people do not comply with the enforcement notice. Information would be made available to local authorities if, for example, neighbours or people in a block of flats felt that that 90-day limit was being extended. In addition, some of the platforms with which you register to rent out your property now have a 90-day cap on the number of days you can let out your property using that platform.

Housing: Rental Market

Debate between Lord Palmer of Childs Hill and Lord Young of Cookham

Thursday 2nd November 2017 Lords Chamber

[Lord Young of Cookham]

As I said a moment ago, outside London there is no restriction on what home owners can do with their homes. They can let them on a series of short-term lets. Precisely to protect the stock in London we have a 90-day rule to prevent the leakage of rented accommodation for Londoners wholly into the tourism market. We will look at the issue again, if the noble Lord insists—but, as a former MP for a London seat, I will need some convincing that we have not got the balance about right at the moment.

[Lord Palmer of Childs Hill (LD)]

Can I try to convince the Minister with the statistic that longer than 90-day lettings in London have increased by 23%? Given this, the Government must increase the funding for local authorities in order to enforce the rule. We may have a 90-day rule in London but there has been a vast increase in people advertising lettings of over 90 days, and trading standards are no good at enforcing the rule in all but one or two London boroughs.

[Lord Young of Cookham]

It would be for planning departments rather than trading standards to enforce the rule. The Government have recently announced that planning authorities can increase their fees by up to 20% precisely to give them the resources they need, among other things, to enforce planning legislation.