Nearly 2,000 owners of holiday rentals faced inquiries from HM Revenue and Customs in the fiscal year 2023-24, marking a significant surge from only 95 cases against AirBNB landlords two years earlier.
Insights provided by The Telegraph, thanks to information accessed through the Freedom of Information Act, suggest a clear pivot in the HMRC’s strategy toward ensuring that those who rent out their properties for holidays are properly taxed on their earnings.
The previous year, 2022-2023, saw 375 such investigations, highlighting the upward trend of HMRC’s scrutiny.
Landlords in the holiday let sector are facing increasingly challenging times with the introduction of stricter regulations by Chancellor Jeremy Hunt.
In April, the exemption limit for Capital Gains Tax was reduced to £3,000 from the previous £6,000.
Furthermore, from next April, owners of holiday homes will not be able to deduct mortgage interest from their taxable profits.
A spokesperson for HMRC told The Telegraph, “As the short-term property rental market flourishes, our duty is to ensure tax compliance for a fair business environment. To this end, we are actively initiating investigations whenever there’s evidence suggesting undeclared rental earnings from holiday lets.”
