114x114_fitbox-420_income_tax_border.jpegLandlords who fail to declare their income or claim too much tax relief could face a nasty bill from the taxman. HM Revenue & Customs has identified 80,000 landlords who are behind with revenue payments.

 

The issue of taxing landlords correctly was raised at a meeting of accountants, tax experts and HM Revenue & Customs last week. The campaign will target "ghost" landlords who have failed to declare themselves as property owners. It will use information from banks, tenants and letting adverts to find those evading their tax responsibilities, reports The Times Newspaper this week.

The discussions are timely: the UK's buy-to-let market continues to balloon - one million more homeowners are intending to rent out a second property by 2010. Research by market analyst Mintel released last month said there are currently around two million people in the UK who own a second home.

Buy-to-let landlords have to pay tax on the rent received and on the capital gain at point of sale. However, landlords can claim tax relief on the cost of managing the property and, in some cases, on the mortgage interest they are charged. It's a case of consult the experts.