A calm first step · on your device
What will it cost to put it right?
If you’ve got undeclared rental income, take a breath — this shows what putting it right would cost, and how much less it costs to come forward now than to wait.
First, the reassurance most people need to hear: for the vast majority of landlords this is a civil matter, not a criminal one. Landlords come forward every day, and it is fixable — the sooner you act, the less it costs. In about two minutes, this shows what putting it right would cost, and how much less it costs to act now than to wait. The figures you put into the calculator stay in your browser — they are not sent to us or saved anywhere. (The optional enquiry form is separate: if you choose to send it, your contact details reach us and are handled under our Privacy Policy.)
Work out what it could cost
1. What’s happened?
A few quick questions about your situation — these decide which penalty rules apply. Answer honestly; it works in your favour.
Most Let Property Campaign cases are the first kind — HMRC calls this a “failure to notify” (you simply never told them about the income). The second is an “inaccuracy” (you sent in a tax return but left the rent off it). The penalty rules are slightly different for each, which is why we ask.
2. The figures
3. How you’ll handle it
HMRC reduces the penalty for “telling, helping and giving access”. Full cooperation earns the biggest reduction.
How the penalty actually works
- The penalty is a percentage of the tax — not a flat fine. So the less tax, the less penalty (which is why claiming every allowable expense matters).
- Your behaviour sets the band. A genuine mistake (careless) is 0–30%. Deliberate is 20–70%. Deliberate and concealed can reach 100%.
- Coming forward first (unprompted) sets a lower floor. A careless, unprompted disclosure within 12 months can be 0%. Once HMRC writes to you (prompted), the floor jumps.
- Cooperation cuts it further. Within the band, HMRC reduces the penalty for the quality of your disclosure — telling (up to 30%), helping (up to 40%), and giving access (up to 30%).
- Interest is separate and is charged on the tax (simple interest, currently 7.75% a year) from when it was originally due — so the longer it’s left, the more it builds.
Whatever the number here, remember: you’re never dependent out of fear. You can do the groundwork yourself — work out the tax in the Disclosure Workbench, find your route with Which Route? — and bring in help for the hard parts. We’re based in Hounslow, west London, and help landlords across the UK.
Five ways to keep the cost down
The penalty and the tax are not fixed — several things are genuinely in your control. Here is where the real savings are:
- Come forward before HMRC contacts you. This is the big one. A voluntary (unprompted) disclosure can cut a careless penalty to 0%; wait for their letter and the floor jumps to 10–20%. On several years’ tax that is often thousands of pounds — the single largest saving you control.
- Claim every allowable expense. The penalty is a percentage of the tax, and the tax is charged on your profit. Every legitimate cost you claim — letting-agent fees, insurance, repairs, ground rent, service charges — lowers the profit, the tax, and the penalty on top. Missing expenses is money left on the table twice over.
- Consider the £1,000 property allowance. If your rents were small, you can deduct a flat £1,000 instead of actual expenses — whichever gives the lower tax. For a modest let, this can wipe out the tax (and penalty) entirely for a year.
- Cooperate fully — “tell, help and give access.” Within your penalty band, HMRC reduces the figure for the quality of your disclosure. Being open, handing over your figures promptly, and giving access to records earns the maximum reduction — pushing you to the bottom of the range.
- Get the behaviour category right. Whether HMRC treats you as having taken reasonable care (no penalty), being careless, or deliberate makes an enormous difference. If you genuinely tried to get it right, that is worth establishing clearly — it is often the highest-value point in the whole disclosure.
A realistic example
Illustrative only — figures rounded to show the shape of it.
Raj let a flat for five years and never declared the rent — not out of dishonesty, he simply didn’t realise a small profit was taxable. The rent was £9,000 a year; after letting-agent fees, insurance and repairs, his profit was about £6,000 a year. He’s a higher-rate taxpayer, so the tax came to roughly £12,000 across the five years.
Raj did two things right. He came forward voluntarily before any HMRC letter, and he cooperated fully — using the Workbench to rebuild every year’s figures and claiming every expense he was entitled to. Because this was careless (not deliberate) and an unprompted disclosure with full cooperation, his penalty landed at around 10% — about £1,200. With interest, his total was roughly £14,000.
Had Raj waited for HMRC to find him, the same case as a prompted disclosure would have carried a penalty nearer 20–30% — £2,400 to £3,600 — on top of more interest. Coming forward saved him between roughly £1,200 and £2,400 in penalty alone (depending where in the prompted range he would have landed), and spared him a formal investigation. The tax he always owed; the extra was avoidable.
The lesson landlords take from this: the tax is the tax, but a large part of the extra — the penalty — is within your control, and acting first is what unlocks it.
Common questions about Let Property Campaign penalties
How much is the penalty for undeclared rental income?
The penalty is a percentage of the tax you owe, not a fixed fine — from 0% for a genuine mistake up to 100% for deliberate concealment. For a genuine mistake where you took reasonable care, there is no penalty at all. If you were careless, it ranges from 0% to 30% of the tax; if the non-declaration was deliberate, 20% to 70%; and deliberate with concealment can reach 100%. Coming forward voluntarily keeps you at the bottom of the range. The calculator above works out your likely figure.
Let Property Campaign penalty rates at a glance
Here is the full picture in one place — the penalty as a percentage of the tax owed, by behaviour and by whether you came forward yourself or HMRC found you first:
| Behaviour | Came forward yourself (unprompted) | HMRC contacted you (prompted) |
|---|---|---|
| Reasonable care (honest mistake) | No penalty | No penalty |
| Careless — never told HMRC | 0–30%* | 10–30%* |
| Deliberate | 20–70% | 35–70% |
| Deliberate & concealed | 30–100% | 50–100% |
*The careless unprompted floor of 0% applies where a failure to notify is disclosed within 12 months of the tax becoming due; after that the floor is 10%. Interest (currently 7.75% a year, simple) is charged on top of the tax and penalty in every case. Offshore matters carry higher maximum bands. Sources: Finance Act 2008 Sch 41 (failure to notify) and Finance Act 2007 Sch 24 (inaccuracies).
Will I go to prison for not declaring rental income?
For the vast majority of landlords, no. Undeclared rental income is treated as a civil matter, settled with tax, interest and a penalty — not a criminal prosecution. Criminal investigation is reserved for serious, deliberate fraud, and coming forward voluntarily through the Let Property Campaign is specifically designed as the civil route to put things right. If HMRC has used the words COP9, CDF or “fraud”, that is different and you should get specialist advice immediately.
Is it cheaper to come forward before HMRC contacts me?
Yes — coming forward voluntarily (unprompted) can cut the penalty to as little as 0%, versus a 10–20% floor once HMRC contacts you. Coming forward voluntarily is an unprompted disclosure, which carries a much lower minimum penalty than a prompted one (made after HMRC writes to you). For a careless failure to notify disclosed within 12 months, an unprompted penalty can be 0%; once HMRC contacts you, the floor jumps. On several years of tax, that difference is often thousands of pounds — and it is the single biggest saving in your control.
What is the difference between a prompted and unprompted disclosure?
An unprompted disclosure is made before HMRC has any reason to suspect you; a prompted one is made after they contact you — and unprompted always costs less. An unprompted disclosure is one you make before you have any reason to believe HMRC has discovered, or is about to discover, the undeclared income. A prompted disclosure is made after HMRC contacts you — a nudge letter, a compliance check, or an enquiry. Unprompted disclosures attract lower penalties, which is why acting before that brown envelope arrives matters so much.
Does the Let Property Campaign cover commercial property?
No — the Let Property Campaign covers residential letting only. If you let commercial property, a different disclosure route applies — ordinary landlords letting homes. If you let commercial property, a different disclosure route applies. Use the Which Route? tool to find the right one for your situation.
How far back does HMRC go for undeclared rental income?
HMRC can go back 4 years for an innocent error, 6 years for careless behaviour, and up to 20 years where the non-declaration was deliberate. Where an offshore element is involved, the limit for innocent or careless errors extends to 12 years. For an innocent error despite reasonable care, HMRC can assess 4 years; for careless behaviour, 6 years; and for deliberate non-declaration, up to 20 years. The Disclosure Workbench helps you rebuild the figures for the years you need to cover.
This is general information for landlords, not advice about your own situation. For your specific circumstances, talk to us.
The number’s only as scary as waiting makes it
The single biggest saving is in your control: coming forward before HMRC contacts you. If that figure worried you, the best next step is a calm, no-obligation conversation.
Ready to talk it through? Send us the details
This is fixable — and you can do a lot of it yourself. For a straightforward case, the free tools take you through it step by step, no accountant needed. For the genuinely complex ones, a professional earns their keep — and we’re here if you want one, or if you’d simply rather not do it alone. The choice is yours.
There’s no charge to make contact and no obligation. Hands-on help starts from a fixed £450 case review, and the full price is always agreed with you before any work begins.