HMRC targeting Airbnb landlords

HMRC targeting Airbnb landlords
HMRC targeting Airbnb landlords

HMRC have announced that they are looking closely at landlords operating short-term property lettings, which are typically booked through online property sites such as Airbnb,, VRBO and Holiday Lettings. This is in an attempt to “stamp out” what HMRC sees as tax evasion within this sector.

HMRC is writing to ‘a small number of customers who might have earned income from short term property lettings to help them get their tax right’. They have advised that they will use information that they hold about property rental in the UK and abroad and other information they hold on taxpayers to identify people who might not have paid what they owe.

It is important to note that if you do not make a voluntary disclosure now and HMRC finds out later, you could be faced with higher penalties and/or face criminal prosecution.

Much like online selling platforms, this is an example of a situation where technology is enabling people to engage in business ventures which would have been impractical in the past. Whilst this is a significant advancement from a commercial perspective, it is obvious that this does come with the risk that people not used to dealing with finance, or HMRC, may not realise that they have a requirement to prepare and file tax returns and/or pay tax.

Rent-a-room relief

If gross receipts from renting rooms is less than £7,500 in a tax year, this does not have to be declared via a self assessment tax return, as this income is automatically exempt through the rent-a-room tax relief scheme, as long as the rooms are let out in your own home. This limit is reduced to £3,750 if two people receive income from the same property.

Please do note that this relief only applies to your main residence i.e. it does not apply to second homes or additional properties.

Property allowance

UK landlords can receive a £1,000 tax free allowance (the “property allowance”) on rental income that they earn. Please note, however, that this is separate to rent-a-room relief and only one of the allowances can be used in a tax year.

Careful consideration is required in regard to the reliefs to be claimed and, in most cases, a computation will need to be undertaken to determine whether claiming the “actual” costs incurred in the short-term property lettings business would be more beneficial. 

If you would like further information in regard to the above, please contact Simon Boxall on or by calling 01895 236 335.

About the author

Simon is the Tax Director at Ward Williams and has more than 20 years of practical experience working in the tax profession.


Specialising in personal tax, Simon qualified as a Tax Technician in 2007, having been awarded with the Ivison medal for attaining the highest mark in the Personal Taxation paper in 2006.


As department head, Simon oversees the tax team across the Ward Williams group, whilst managing a diverse portfolio of clients including high net worth individuals, doctors, directors of owner managed businesses, partnerships and sole traders.

01895 236335