The figure is only marginally above the previous year’s total but is significantly higher than the £65.4 million recovered in 2022/23, with HMRC now clawing back an average of £13,713 per disclosure

HMRC has recovered a record £107 million from tax investigations into landlords in 2024/25, according to a Freedom of Information request by accountancy firm Price Bailey.

The figure is only marginally above the previous year’s total but is significantly higher than the £65.4 million recovered in 2022/23, with HMRC now clawing back an average of £13,713 per disclosure.

Since HMRC’s Let Property Campaign launched in 2013, around £570 million has been recovered from UK residential landlords. That includes 100,332 disclosures from an estimated 2.2 million private landlords (4%).

Andrew Park, tax investigations partner at Price Bailey, said many landlords caught out are ‘accidental’ investors who have failed to understand their tax obligations.

They (landlords) are often accidental landlords who kept a property after moving to cohabit with a new partner, inherited a property or temporarily moved abroad. Many are not financially sophisticated or in receipt of high levels of other income, haven’t properly understood their responsibilities and haven’t previously sought advice, Park said.

He said: We’ve assisted large numbers of landlords in making voluntary disclosures over the last few years – typically after they’ve received an HMRC nudge letter.

There is a widespread confusion about the different tax treatment of capital expenditure and revenue expenditure, he added.

Another big area of confusion is the withdrawal of mortgage interest relief, which has created what Park calls a ‘phantom profit’ tax trap. That’s because landlords face a fundamental mismatch between economic and taxable profit. Rental properties will appear profitable on paper, but only because the tax law ignores the full cost of debt servicing, and this then leads to landlords failing to disclose it to HMRC.