HMRC has been running the Let Property Campaign for over 12 years to make sure landlords who earn income by letting out residential property pay the correct tax in the UK.
The campaign pulled in a record £107 million in 2024–2025, which was over 60% more than the previous year. However, the number of voluntary disclosures actually fell from 11,000 to below 8,000.
With larger amounts being paid, this highlights the risk of ignoring nudge letters from HMRC, as the more you owe in outstanding tax, the greater the interest and penalties will be.
Here are some common mistakes that landlords should avoid when paying tax on rental income.
Common mistakes by residential landlords
Some tax errors are caused by deliberate evasion, but it can be easy to misunderstand property letting rules and pay the wrong amount of tax by accident. Common situations include:
- Renting out an inherited property – If the landlord only lets a single property after inheriting it, they may not realise that they still need to declare the income from this to HMRC.
- Moving in with a partner and renting out the other property – If someone moves into their partner’s home and lets their previous property, even if the rent only covers the mortgage payments so there isn’t really any profit, only the interest will qualify for tax relief.
- Purchasing a property for a child in university – A parent might purchase a property for their child to live in rent-free while studying at university. However, if the child allows rent-paying friends to move in with them, this income must then be declared to HMRC.
Capital expenditure can also confuse landlords when declaring taxable income, as only like-for-like replacements are deductible expenses, while significant property upgrades are not.
Do you need to make a voluntary disclosure?
This HMRC campaign only applies to landlords of residential properties and doesn’t apply to companies or commercial properties. Voluntarily disclosing untaxed rental income will make penalties more lenient.
More information about the Let Property Campaign is available on the government website to help you understand whether you need to make a disclosure, how to do this, and how to pay HMRC.
In some cases, as letting platforms provide information directly to HMRC, the tax agency may send nudge letters to prompt landlords to double-check their rental income and tax liabilities.
Whether you’ve already received a letter from HMRC or you think you may have declared the wrong amount, whatever the reason, you can seek help from a professional tax adviser.
Here at gbac, we have a team of experienced accountants in Barnsley who can provide a range of tax planning and tax management services for residential landlords in the UK.
To learn more, call 01226 298 298, or email your details to info@gbac.co.uk and we’ll be in touch.
After a proposal by the Bank of England to cap stablecoin holdings for individuals at £10,000 or £20,000 received strong criticism, the Bank may be softening this stance.
A stablecoin is a cryptocurrency that maintains a stable value in relation to a specific asset, such as the US dollar. It’s believed by many that a restriction on stablecoin holdings would leave the UK falling behind the EU and US when it comes to regulating digital assets.
As the proposed maximum for businesses is £10 million, it may be a relief to those using stablecoins that the Bank of England seems to be backtracking on its stance against this form of cryptocurrency.
Here’s what businesses should know about stablecoin holdings under the current rules.
Why does the Bank of England want to cap stablecoins?
The majority of stablecoins are currently tied to US dollar-based products, with some worth up to $300 billion circulating. While they aren’t mainstream yet, they’re convenient for investors and those carrying out cross-border transactions.
Individuals can park funds using stablecoin while buying and selling more volatile assets or use stablecoins to pay for things while avoiding the extra costs associated with traditional methods, like credit cards.
The Bank of England is concerned about the future emergence of sterling-dominated stablecoins in retail and wholesale payment systems in the UK, so the Bank is aiming to set up a regulatory framework for a ‘real world’ multi-money system in advance, which should be finalised next year.
What about other cryptocurrencies like Bitcoin?
While stablecoins are becoming an alternative option, many businesses hold Bitcoin as an asset. This is because holding Bitcoin provides more diversification and can offer protection against inflation compared to treasury assets like cash and gilts, while also making the business seem more digitally savvy.
However, Bitcoin holdings still come with risks, including price volatility and custodial challenges. These involve including Bitcoin on balance sheets at cost, as it’s classified as an intangible fixed asset under UK Generally Accepted Accounting Practice.
It’s also worth noting that crypto assets are treated like shares when it comes to Capital Gains Tax liability.
Need accounting advice on crypto holdings?
While it hasn’t been updated for a couple of years, the Bank of England has published a stablecoin guide that explains what they are, how they work, and the Bank’s current stance on their use in the UK.
If you need professional financial guidance on crypto assets and transactions, whether as an individual or as a business, you may want to consult financial advisers like our accountants in Barnsley.
Here at gbac, our experienced team can help you with accounting and tax management for traditional and digital currencies. Simply call us on 01226 298 298 or email info@gbac.co.uk to find out more.
As announced earlier this year, Companies House will be introducing mandatory identity verification this autumn. This process will be compulsory from 18th November 2025.
Depending on when their company’s next confirmation statement is due to be filed at Companies House, the date for directors to confirm they have verified their identity may vary.
Here’s what directors and persons with significant control (PSCs) will need to do from November 2025.
Verification for directors
All existing company directors must verify their identity with Companies House, but those who are directors of multiple companies will only need to register once.
Once a director’s identity has been verified, Companies House will send them an 11-character code. They must use this code the first time they file a confirmation statement for their company from 18th November.
If a confirmation statement is already due in early November, then the director won’t need to verify their identity until November 2026, so it may be worth filing early to defer verification.
All directors who are appointed on or after 18th November will need a personal code to proceed.
While the same identity verification requirements apply to members of limited liability partnerships (LLPs), identity verification will not be required for corporate directors until a later date.
Verification for PSCs
Like directors, people with significant control must also verify who they are. If you are both a director and PSC of the same company, you will need a separate personal code for each role, and you must submit the PSC code within 14 days of the company’s next confirmation statement date.
However, if you are a PSC but not a director, you must provide the code within 14 days of your birth month. For example, a PSC born in January must submit their code between the 1st and 14th of January 2026.
Anyone who becomes a PSC from 18th November 2025 onwards will need to provide their 11-character personal code within 14 days of registering at Companies House.
Get help with Companies House
More information about Companies House identity verification is available on the government website, but if you need professional assistance with filing company accounts, you can seek expert advice.
Here at gbac, we have a knowledgeable team of Barnsley accountants who can help businesses of all sizes comply with account filing requirements at Companies House.
For more information on how we can help you with company accounts, contact us by phone or email.
HMRC has now withdrawn the VAT652 form, which means companies that have made large errors in their VAT returns must follow updated processes to submit corrections.
Method 1 is required for smaller errors, while Method 2 is required for larger errors.
Here’s how to tell HMRC about an error on your VAT return from September 2025.
Method 1
The first method of correcting small errors on VAT returns simply lets taxpayers adjust their current tax return, which is allowed in the following scenarios:
The net error is less than £10,000(along with any previous errors in the last 4 years). For example, if you underpaid £11,000 on sales but underclaimed £2,000 on purchases, then the net error would be £9,000, so you could correct these errors using Method 1.
The net error is £10,000–£50,000 and less than 1% of the current return’s output. Meaning that for a £2.5 million output, you could correct a net error of up to £25,000 with Method 1.
Method 1 corrections will not receive late payment interest or penalties if the business has taken reasonable care to update their VAT return as soon as possible.
Method 2
Since the VAT652 form was withdrawn, any errors that are larger than the Method 1 allowances need to be corrected online (or otherwise by notifying HMRC in writing).
If your company needs to notify HMRC about a large VAT return error, you must include information about how it happened and when. Method 2 corrections will incur late payment interest charges.
Penalties for VAT return errors
If a business makes a VAT return error either deliberately or out of carelessness, then HMRC will apply VAT penalties for late payment. While you can still use Method 1 to correct careless errors, Method 2 must be used to correct deliberate errors.
To ensure you follow the right process, read HMRC’s guidance on how to amend VAT records.
If you find these processes confusing and want to make sure you avoid errors and penalties, you also have the option to consult financial experts like our accountants in Barnsley.
To enquire about help with VAT management, get in touch by calling 01226 298 298, or send an email to info@gbac.co.uk with your information and we’ll get back to you soon.
If you’re planning on buying a property, you should learn from the former Deputy Prime Minister Angela Rayner’s tax problems to avoid making the same costly mistakes.
In September, the Deputy Prime Minister and Housing Secretary found herself in hot water after it was discovered that she owed £40,000 in Stamp Duty Land Tax (SDLT).
Here’s what homebuyers should know about the Stamp Duty situation, to prevent getting caught out the same way when buying a new home if you still own another property.
Why did Angela Rayner underpay Stamp Duty?
The former Deputy Prime Minister had sold interest in her first home in Ashton-under-Lyne to a trust to benefit her child, before buying a new apartment in Hove.
However, according to Paragraph 12 of Schedule 4ZA of the Finance Act 2003, Rayner would still be considered an owner of the property for SDLT purposes. Since Rayner did not follow guidance to seek expert tax advice, she did not know this, and underpaid SDLT as a result.
Rayner must now pay the £40,000 owed and may also face a fine of up to £12,000 for carelessness.
This is due to a 3% surcharge introduced by the Conservative government in the 2015 Autumn Budget, which was increased to 5% in the 2024 Autumn Budget. The legislation was designed to discourage people from purchasing second homes or buy-to-let properties while first-time buyers are struggling with the pressured housing market.
To ensure that buyers pay extra SDLT if they already own a residential property on the day they buy another one, the legislation closed loopholes like using trusts or companies to shift ownership.
This is why Rayner owed extra tax and will face financial penalties, which could have been avoided if she had consulted a tax expert who would have explained her full tax liabilities.
Consult a professional tax adviser on SDLT
There are several lessons to be learned from Rayner’s very public tax blunder, but most important is the reminder that you should always seek professional tax advice before committing to a purchase or sale to ensure you know how much tax you’ll have to pay.
The government’s Stamp Duty Land Tax guide is available online, but it’s better to be safe than sorry when it comes to understanding tax rules for property buyers.
So, if you need to speak to a tax adviser whose judgement you can trust, be sure to get in touch with our accountants in Barnsley for guidance on SDLT and asset taxes.
You can reach us by calling 01226 298 298 or sending an email to info@gbac.co.uk.
From 1st September 2025, fully electric cars will have two separate advisory fuel rates, depending on whether the electric car is charged at home or at a public charging station.
Employees can use HMRC’s advisory fuel rates for reimbursement for business travel in company cars, or if they have to repay their employer for fuel used for private travel.
Read on to learn how electric car charging rates are changing and how this might affect employees and employers using electric company car schemes in the UK.
What are the new electric car charging advisory rates?
Previously, the electric car rate was 7p per mile, no matter where the vehicle was charged. Reimbursing at this rate meant drivers would face a shortfall if they used more expensive public charging networks.
Advisory rates for charging electric cars are now 12p for public charging and 8p for home charging.
The new rates can be applied from 1st September, though the previous single rate will still be available until 30th September. From 1st October 2025, only the new rates will apply.
This change reflects the higher cost of using public chargers, but it’s based on the cost of a slow or fast charge – not the more expensive ultra-fast charging that many drivers may use to save time.
Drivers can only be reimbursed for the higher cost of super-fast charging if it can be substantiated.
How might this affect electric company cars?
When business mileage on company cars is reimbursed at acceptable rates, employees and employers won’t face taxable fuel benefits or National Insurance Contribution implications.
However, record-keeping for different charging locations may become more complicated for employers.
It’s also important to note that the new advisory rates only apply to fully electric cars. As hybrid cars are treated as petrol or diesel vehicles, the advisory rates for those types will apply.
The petrol rate isn’t changing, but some diesel rates are increasing by 1p per mile. More information about advisory fuel rates for company cars is available on the government website.
If you need financial advice or accounting support to help manage company car costs, our accountants in Barnsley can provide tax consultancy and payroll services at gbac.
To get in touch, call 01226 298 298, or send an email to info@gbac.co.uk to find out more.
If you’re thinking about selling your business soon, it’s important to consider whether relief will be available to help reduce the Capital Gains Tax (CGT) bill for this asset disposal.
Business Asset Disposal Relief (BADR) is currently 10% lower than the higher CGT rate, at a flat rate of 14%. However, as stated in the Autumn 2024 Budget, this will increase to 18% next spring.
This means business owners should aim to sell their company sooner rather than later, as the tax relief will be less advantageous for disposals made on or after 6th April 2026.
Keep reading for a quick summary of the BADR rules and the relevant considerations.
BADR rules for CGT
Previously known as Entrepreneurs’ Relief until 2020, BADR comes with several conditions. To be eligible, you must be a sole trader/director who has owned the company for at least 2 years.
If you’re selling shares rather than the whole trading company, similarly, you must have been a shareholder, employee, or business partner with at least 5% shares for 2 years.
This means if you haven’t reached the two-year mark of ownership or shareholding yet, you’ll have to wait until you do to sell your company if you want to benefit from BADR.
There is also a lifetime limit, which only allows an individual to claim BADR for up to £1 million of eligible gains. This may not be a concern for most company owners, but those who regularly buy and sell companies should bear this in mind when planning acquisitions and sales.
Considering selling your business?
Calculating the taxable gains is one of the most important steps when preparing to sell a business. In most cases, this will simply be the difference between the selling price and the nominal value.
However, there are some circumstances that can complicate the tax situation, such as:
- Selling shares that were inherited or received as gifts
- Involving shares or loan notes instead of a straightforward cash sale
- Phased payment plans that are dependent on future performance
In cases like these, professional guidance is essential to help establish base costs and gains. For help selling your company in the most tax-efficient way, please contact us in advance.
At gbac, our team of accountants in Barnsley includes experienced corporate finance advisers who can help business owners to sell their companies or raise finance.
For more information or to arrange a corporate finance consultation, get in touch by calling us on 01226 298 298 or emailing info@gbac.co.uk.
If your company has miscalculated its marginal Corporation Tax relief, you may be due to receive a letter from HMRC – if you haven’t already as part of the tax agency’s new campaign.
HMRC is sending one-to-many letters warning companies to make sure they aren’t making any errors when claiming Corporation Tax relief, such as ignoring associated companies.
Here’s a reminder of the rules and what you should do if you receive one of these letters.
Corporation Tax rules for associated companies
If you’re a company director, you should be aware that the tax rate on the first £50,000 in profits is 19%, while the 25% main rate applies when company profits reach £250,000.
The transition from the lower rate to the main rate is eased by marginal tax relief, but some company directors may not be aware that the profit thresholds apply across all associated companies.
For example, if a company has two associated companies, marginal relief will apply to profits from £16,667 to £83,333, unless the other companies are dormant.
HMRC considers companies to be associated if one company is under control by the other, or both companies are under common control. It doesn’t matter where the companies are resident or whether they were only associated for part of the accounting period.
The rules can be quite complicated – in some cases, if a director’s spouse, civil partner, parent, child, or sibling also owns a company, HMRC could treat this as an associated company, too.
What to do if you receive an HMRC Corporation Tax letter
If your company receives a letter about this from HMRC, you will have 30 days to respond and make any necessary amendments to your Corporation Tax marginal relief claim.
Even if HMRC was mistaken in targeting your company and the alleged associated business is dormant, you shouldn’t ignore the letter and should still provide an update to HMRC.
If HMRC doesn’t hear from you, this could lead to a time-consuming formal compliance check.
It’s therefore essential to review your overall company structure if having associated companies increases your Corporation Tax bill, as it may be better to combine associated companies.
For more information, you can read the government’s guide to Marginal Relief for Corporation Tax, or seek professional financial advice for Corporation Tax planning.
Here at gbac, we have a team of accountants in Barnsley who are knowledgeable about tax reliefs and can assist your company with efficient Corporation Tax management.
Contact us by calling 01226 298 298 or sending an email to info@gbac.co.uk to learn more.
After discovering that a third of pension relief claims made by PAYE tax codes weren’t correct, HMRC is now tightening checks on claims submitted for pension tax relief.
If you submit claims for pension relief, keep reading to learn how this could affect you.
What’s the problem with pension relief claims?
Personal pension contributions are made after paying basic-rate tax, so only taxpayers in the higher rate or additional rate bands need to claim relief on private pension contributions.
However, HMRC found that basic-rate taxpayers often tried to claim pension relief, too, or even made claims after relief had already been granted through salary deductions.
To make matters worse, instead of using information from their pension provider, some claimants simply guessed how much they paid into their personal pension that year.
How are pension relief claims changing?
Going forward, it will no longer be possible to claim pension relief over the phone. From 1st September 2025, most pension relief claims must be made online instead.
Postal claims will only be possible for those with a valid reason for not claiming online.
Additionally, while HMRC previously only required taxpayers to provide proof of pension payments if they exceeded £10,000, the agency now requires supporting evidence for all relief claims.
This means you’ll need a letter or statement from your pension provider each tax year showing how much you contributed to your personal pension if you want to make a relief claim.
These changes won’t impact individuals who submit self-assessment tax returns, as their pension relief claims will continue through their tax return as normal.
So, who can claim pension relief?
Higher rate taxpayers and additional rate taxpayers who pay into a personal pension or workplace pension are entitled to claim an additional amount of tax relief.
For example, an additional rate taxpayer would receive a further 25% in pension relief.
In Scotland, taxpayers in the intermediate rate band or higher can apply for tax relief on private pensions.
If tax relief is not automatically given on their pension contributions, taxpayers can also make a claim.
Guidance on how to claim tax relief on private pension payments is available on the government website, or you can contact a financial adviser for personalised pension advice.
With retirement costs and the State Pension Age rising, it’s important to make sure you’re contributing enough to your personal pension to support you through retirement.
This includes optimising tax reliefs, which our Barnsley accountants can help you with.
Here at gbac, our experienced team will be happy to assist you with tax-efficient pension planning. Just call us on 01226 298 298 to get started, or email info@gbac.co.uk for more information about our services.