Short-Term Letting

Lord Palmer of Childs Hill Excerpts

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.