Once you notify HMRC of your intent to join the Let Property Campaign (LPC), the countdown begins. You are issued a unique Disclosure Reference Number (DRN) and a Payment Reference Number (PRN), and you have exactly 90 days to calculate your figures, submit your disclosure, and pay the balance.
At Villian Amindeh, we call this the “Execution Phase.” The 90-day window sounds generous, but when you are dealing with years of missing bank statements and complex tax rules, time disappears quickly. Here is your roadmap to a successful submission.
1. The Timeline: Notification to Settlement
The LPC is a structured process. Missing the 90-day deadline can result in HMRC rejecting your disclosure and opening a formal (and much more expensive) enquiry.
- Day 1: Formal Notification via the Digital Disclosure Service (DDS).
- Day 2–60: The “Deep Dive.” This is when we reconstruct your rental accounts.
- Day 60–80: We calculate the “Tax Gap,” statutory interest, and the behavior-based penalty.
- Day 80–90: Formal submission of the disclosure and payment of the total amount.
2. Essential Documentation Checklist
To make an accurate disclosure, we need to move beyond “estimates” wherever possible. You should begin gathering:
- Income Records: Tenancy agreements, letting agent annual statements, or bank statements showing rent deposits.
- Expense Evidence: Invoices for repairs, insurance certificates, management fee statements, and utility bills for void periods.
- Mortgage Data: Annual mortgage interest certificates (usually provided by your lender every January).
- Other Income Info: Your P60 or P11D (if employed) or self-employed accounts. Your rental tax is determined by your total income, so we need the full picture to apply the correct tax bands.
3. Dealing with Missing Records
What if you don’t have bank statements from six years ago?
- Bank Requests: Most banks can provide historic statements for a small fee, though this can take 2–3 weeks (hence the urgency).
- Reasonable Estimates: If records are truly lost, HMRC allows for “Best Estimates.” We can use local rental market data and average maintenance costs for your property type to build a defensible set of figures.
- The Narrative: We must include a note in your disclosure explaining why records are missing and how we reached our estimates.
4. Calculating the “Add-Ons”: Interest and Penalties
Your disclosure isn’t just about the tax. HMRC expects you to “Self-Assess” two other figures:
Statutory Interest
This is not a penalty; it is compensation to the government for not having the money on time. Interest rates for late tax have risen significantly in 2025 and 2026. We use specialized software to calculate interest from the date the tax should have been paid to the current date.
The Penalty Offer
You must make a “Formal Offer” of a penalty. As discussed in previous articles, this is based on your behavior:
- Reasonable Care: 0%
- Careless (Unprompted): 0% – 30%
- Deliberate (Unprompted): 20% – 70%
5. Making the “Formal Offer”
A unique feature of the LPC is that it is a Contractual Disclosure. When we submit the form, we are making a “Formal Offer” to pay a specific amount. If HMRC accepts this offer, it becomes a legally binding contract that prevents them from re-opening those specific years in the future (provided your disclosure was honest).
6. What If You Can’t Pay Everything on Day 90?
If the final bill is larger than expected, do not wait until Day 90 to tell HMRC. * We can negotiate a “Time to Pay” (TTP) arrangement.
- HMRC is generally more open to payment plans (spreading the cost over 6–12 months) if the request is made as part of a voluntary disclosure.
Frequently Asked Questions (FAQs)
Can I submit the disclosure before the LPC 90 days are up?
Yes. You can submit as soon as your figures are ready. In fact, submitting early reduces the amount of statutory interest you have to pay.
What happens if I miss the LPC 90-day deadline?
HMRC may remove you from the campaign. This means you lose the “favourable terms” and lower penalties. They may then open a formal enquiry into your affairs.
Does HMRC check every single LPC disclosure?
HMRC “reviews” every submission. If your figures look sensible and match their “Connect” data, they usually issue an acceptance letter within 30–60 days. If the figures look suspiciously low, they will ask for evidence.
Do I need to send my LPC receipts to HMRC with the disclosure?
No. You don’t send the receipts with the form, but you must keep them for 6 years after the disclosure. HMRC can ask to see your “working papers” at any time during that period.
Can Villian Accountants handle the LPC payment for me?
You usually pay HMRC directly using your PRN (Payment Reference Number). However, we ensure you have the exact bank details and references to ensure your payment is allocated correctly to your disclosure.
Beat the LPC Clock with Villian Accountants
The LPC 90-day window is the final hurdle to tax peace of mind. Let Villian Accountants take the lead on the calculations and the paperwork, so you can focus on the future of your property investment.
This is a smart move. When clients see a ticking clock, their first instinct is usually to panic-ask a dozen questions. Having a clear FAQ section ready prevents “inbox overload” and keeps them focused on the task.
Since we are currently in February 2026, I’ve included updates on the new interest environment and the looming Making Tax Digital (MTD) requirements.
Frequently Asked Questions: Mastering the Let Property Campaign
1. Who exactly can use the Let Property Campaign?
The LPC is for individual residential landlords. This includes:
- Renting out a single property or a large portfolio.
- Renting out a room in your own home (if it exceeds the £7,500 Rent-a-Room threshold).
- Holiday lets and student accommodation.
- Landlords living abroad but renting out UK property.
Who is excluded? Companies, trusts, and those renting out commercial property (shops, offices, or garages) cannot use this specific campaign.
2. I’ve received a “Nudge Letter” from HMRC. Is it too late?
Not yet, but the clock is ticking faster. A “nudge letter” means you are in the “Prompted” category. You can still use the LPC, but your penalty rates will be higher than if you had come forward voluntarily (unprompted). If HMRC opens a full formal enquiry before you notify them, the LPC door usually slams shut.
3. How are the penalties actually calculated?
It’s not a random number. It’s a two-step process:
- Behavior: We determine if the error was “Careless” or “Deliberate.”
- Quality of Disclosure: HMRC gives “points” for how well you Tell them what happened, Help them quantify it, and give Access to records. A “perfect” disclosure can drag a penalty from 30% down to 10% or even 0%.
4. Why is the interest so high?
Statutory interest is currently 7.75% (as of early 2026). HMRC views this as “restitution”—essentially, you’ve had a low-interest loan from the government for several years, and they are now collecting. Unlike penalties, interest cannot be mitigated or waived; it is a mathematical certainty.
5. What if I can’t find my records from 5 years ago?
HMRC knows life happens. We can use “Reasonable Estimates.” For example, if you don’t have a 2021 repair invoice, we can use 2022 data adjusted for inflation or local tradesman averages. As long as the estimate is “defensible” and we disclose the method, HMRC typically accepts it.
6. Will I have to do a Self-Assessment return every year now?
Yes. Once you are on HMRC’s radar, you must stay “digitally compliant.” Starting April 2026, if your gross rental income is over £50,000, you will also be required to follow Making Tax Digital (MTD) rules, which involve quarterly digital updates rather than just one annual return.
7. What happens on Day 91?
If you haven’t submitted or agreed to an extension, HMRC assumes you are no longer cooperating. They may cancel your DRN, reject the “favourable terms” of the campaign, and move your case to the Fraud Investigation Service or a high-intensity audit team. Never let the clock hit zero.
8. “I owe £20,000 but only have £5,000 in the bank. What now
This is where a Time to Pay (TTP) arrangement comes in. We can propose a payment plan as part of your disclosure. HMRC is far more likely to agree to a 12-month plan if you ask before the 90-day deadline rather than waiting for them to chase you for the debt.