HMRC nets ‘record’ £107m from landlord tax investigations

HM Revenue and Customs (HMRC) collected a “record” £107m from compliance activity targeting landlords in 2024/25, more than double the amount secured in 2021/22, according to Price Bailey.

The figures, obtained by the firm under the Freedom of Information Act, show the Let Property Campaign (LPC) has raised £570m in total since its launch in 2013/14. The campaign encourages residential landlords to make voluntary disclosures.

In 2024/25, HMRC recovered an average of £13,713 in tax per disclosure, the highest amount recorded since the LPC began. 

The sums cover both voluntary disclosures and other compliance measures, including action against non-responders and discovery assessments.

There are about 2.2 million private landlords in the UK, according to government data from early 2024. To date, 100,332 disclosures have been made under the LPC, just over 4% of the total landlord population.

Price Bailey said the numbers highlight HMRC’s capacity to identify thousands more undisclosed landlords each year. The firm noted that while many landlords make little or no economic profit, they often fail to realise they still have taxable income.

Andrew Park, tax investigations partner at Price Bailey, said: “We’ve assisted large numbers of landlords in making voluntary disclosures over the last few years – typically, after they’ve received an HMRC nudge letter.”

“They are often accidental landlords who kept a property after moving to cohabit with a new partner, inherited a property or temporarily moved abroad. Many are not financially sophisticated or in receipt of high levels of other income, haven’t properly understood their responsibilities and haven’t previously sought advice.”

He added: “It is very easy for landlords to get caught in the “phantom profit” tax trap. Since the phased withdrawal of mortgage interest relief, landlords have faced a fundamental mismatch between economic and taxable profit. 

“Many landlords now appear profitable on paper but only because tax law ignores the full cost of debt servicing. This creates a “phantom profit” effect: landlords owe tax on income they never truly received, pushing them into arrears or triggering compliance failures.”