A London council has been working with HM Revenue & Customs (HMRC) to identify landlords that have failed to declare their rental income.
Newham Council – which has 27,000 landlords registered through its compulsory licensing scheme – says 13,000 have not registered for self-assessment.
It has previously estimated that unpaid tax from landlords could be costing the public purse up to £200 million across the capital.
“It is our understanding that, to date, up to 13,000 Newham landlords are of interest to HMRC, where there are discrepancies between declared income and our records, with potentially significant financial implication for the exchequer,” wrote Sir Robin Wales, the Mayor of Newham, in a letter to the chancellor, Philip Hammond.
“At a time when local authorities are experiencing savage cuts and Newham alone has had half its grant funding cut; possible tax evasion on this scale takes money from vital public services.”
“This is money out of the pockets of our poorest residents who rely on our services the most.”
The Guardian reports that HMRC is currently contacting Newham landlords who have failed to register their rental revenues.
Newham introduced its borough-wide licensing scheme in 2013 and is currently in the process of applying for a renewal.
Over the last five years, the council reports that it has instigated 1,135 prosecutions for housing crimes, banned 28 of the worst landlords from operating in the borough, recovered over £2.6 million a year in council tax and served 2,170 notices to improve housing conditions and management.
In a comment article written for the Guardian, journalist Patrick Collinson praises the ‘trailblazing work’ done by Newham Council and says local authorities around the country should follow suit.
He says that the licensing scheme in Newham has ‘overwhelming’ support from residents and even from ‘most landlords’. He says this is because rogue landlords drive down standards and give good landlords a bad name.
In the piece, which you can read here, Collinson asks whether we have gone too far in ‘vilifying’ landlords.
