The Office of Tax Simplification (OTS) has published an online survey and a Call for Evidence as part of their Review of Property Income. The aim is to see if the current and often complicated regimes for the taxation of residential property can be simplified. The key area of review is the receipt of residential property income.

Following the publication of its 'Property Income Review Scoping Document' in February 2022, the OTS has followed up with the launch of an online survey and a separate but more detailed Call for Evidence.

The online survey is aimed at those receiving income from residential property rentals. The rentals can be short or long term and include Furnished Holiday Lettings. Views are sought from individuals, partnerships and companies. The survey can be accessed here.

The Call for Evidence is open until 5 June 2022 and can be responded to by emailing This email address is being protected from spambots. You need JavaScript enabled to view it..  Online meetings are also available for anyone keen to meet with the OTS to express their views. Such a meeting can be requested by 3 May 2022.

The Call for Evidence sets out the following questions, which can be answered in their entirety or in part.

Structural aspects
1. Do any particular issues arise as a result of differences in the tax treatment of property income and income from other investments, such as OEICs, or quoted shares?
2. Does the existence of different regimes for taxing property income and other income from investments lead to any distortions in behaviour?
3. Do any particular difficulties or benefits arise in relation to letting activities as a result of the different rules for the taxation of property income and trading income?
4. What prompts landlords to incorporate their property rental businesses and to what extent are such decisions motivated by tax or non-tax reasons?
5. What are the benefits and drawbacks of having a different regime for taxing property income and capital gains from Furnished Holiday Lettings?
6. To what extent do those owning property taxed under the Furnished Holiday Lettings regime use the property themselves?
7. Have you encountered any issues as a result of changes in a property’s use or ownership, including varying the property ownership percentages?

Operational aspects
8. What factors influence the choice between using the cash basis and accruals basis accounting, where rental income is less than £150,000 a year? How well understood are the implications of using each regime and of moving between these regimes?
9. Are there any difficulties with the operation of reliefs and exemptions available to those with property income?
10. Have you encountered any difficulties in understanding the rules about, or the tax processes involved in, becoming or being a landlord, including HMRC’s information and registration requirements?
11. Do you have difficulties in finding out, getting guidance about or understanding how your property income should be taxed?

Administrative and compliance aspects
12. Are you aware of any information being provided by third parties, for example letting agents or platforms to assist landlords in understanding their tax obligations?
13. Do you think that third parties, such as letting agents, platforms or holiday rental agency businesses, could assist in easing tax administrative burdens and in what ways?
14. To what extent could it be helpful to landlords if letting agents, platforms or holiday rental agents provided data to HMRC on their behalf?
15. What is your experience of completing a tax return to report property income? Are there any specific areas that cause difficulty?
16. Are there any other areas of tax administration that present particular challenges in relation to property income?
17. Making Tax Digital for Income Tax starts in April 2024 and mandates quarterly electronic updates for most individuals with a turnover of over £10,000 for their property (and business) income. Are you aware of these reporting obligations and have you considered how you might comply with them?
18. Are there any other practical, technical and administrative issues in relation to property income that are not mentioned above?

Non-UK aspects
19. Are there any particular issues of concern to non-resident landlords or their tenants (including in relation to the Non-Residents Landlord Scheme)?
20. Do any particular issues arise for UK residents receiving rental income from overseas?

Useful guides on this topic

Adviser’s Guide: Property Business, profits and losses
TOP-RATED Guide: What is property income? How is it taxed? How are profits calculated? How are losses relieved? Is NI paid on property income? Is property income classed as a business activity? 

Furnished Holiday Letting
What is Furnished Holiday Letting? How do you qualify for Furnished Holiday Letting? What are the rules for Furnished Holiday Letting?

Non-resident landlords and offshore investors index
What taxes are relevant for non-resident property investors?  What are the reporting requirements for non-resident investors? 

Not so simple: new review of taxation of residential property
The Office of Tax Simplification (OTS) has published 'Property Income Review Scoping Document', this review aims to identify opportunities to simplify the taxation and administration of individuals, partnerships and micro-companies that receive a residential rental income.

External links

Review of Property Income - Survey and Call for Evidence

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