The fact that you’re reading this blog means you’re a business owner or you are self-employed – but you might also have a second income.
Receiving revenue from more than one source is not unusual; perhaps you’ve taken on additional work to help make ends meet while you get your business established, or maybe you earn rental income from a property you own.
Each of us has our own unique set of personal circumstances, and HMRC (HM Revenue & Customs) relies on us to honestly declare all the income we receive so that any tax due can be accurately calculated and recovered.
Failure to notify HMRC about additional income can lead to penalties, interest on tax due, and in extreme cases, can even result in prosecution and a criminal record. Coming clean with HMRC is always a far better option than waiting for them to come to you as they inevitably will.
From time to time, HMRC runs campaigns focused on specific sectors, giving those targeted the opportunity to make a voluntary disclosure, bring their tax affairs up to date – and get the best possible terms.
Anyone making a voluntary disclosure has four months to pay any back tax and interest they owe, and if more time is needed, HMRC may discuss repayments over a longer period.
Currently, HMRC is running two campaigns aimed at anyone who is receiving undeclared revenue, either from a second income, or from a rental property. If you fall into one of these sectors, now is the time to make a voluntary disclosure:
HMRC Second Income Campaign
If you’re receiving a second income, and it’s not being taxed either at source through Pay As You Earn (PAYE) or Self-Assessment, you need to make HMRC aware.
A second income can be earned in many different ways including:
HMRC Let Property Campaign
If you are an individual landlord (not a company or trust) letting out residential property in the UK or overseas, and you’ve earned letting income but not paid tax on it, you must declare this to HMRC.
You will be in this category if you are:
Don’t Wait, Act Now!
Honesty is always the best policy – especially where HMRC is concerned. If you are receiving income that HMRC don’t know about, using the voluntary disclosure process while they’re running these campaigns is your opportunity to set your tax affairs in order, and save yourself at the very least, considerable aggravation and expense in the future.
If you’re not sure whether you need to make a voluntary disclosure, or you’d like us to represent you in your dealings with HMRC, call us now on 01235 868888 or 01865 821100 and let’s have an initial chat in complete confidence.