The council estimated that unpaid tax by landlords is costing the public purse nearly £200m in London – and far more nationally. 

In a letter sent to the chancellor, Philip Hammond, the mayor of Newham, Sir Robin Wales, said:

It is our understanding that, to date, up to 13,000 Newham landlords are of interest to HMRC, where there are discrepancies between declared income and our records, with potentially significant financial implication for the exchequer.”

Newham is battling with the Department for Communities and Local Government to have its licensing scheme renewed, following a 2015 clampdown by the government, which said licensing imposes “unnecessary additional costs” on landlords. Neighbouring borough Redbridge has already had its application for landlord licensing rejected.

Wales told the chancellor in his letter: “Our core grant funding has halved since 2010-11, that’s less money for our schools, less money for social care, and less money for housing. I urge you to assess the additional benefits of Newham’s licensing scheme in assisting the exchequer to address tax evasion by landlords.”

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Housing minister Brandon Lewis wrote to local authorities in March 2015 to warn them of an amendment to licensing rules. He said: “The blanket licensing approach adopted by some local authorities has major drawbacks. This is because it impacts on all landlords and places additional burdens on reputable landlords who are already fully compliant with their obligations, thereby creating additional unnecessary costs for reputable landlords which are generally passed on to tenants through higher rents.

“The vast majority of landlords provide a good service and the government does not believe it is right to impose unnecessary additional costs on them, or their tenants. Such an approach is disproportionate and unfairly penalises good landlords.”

However, Newham said its licensing had won the support of 90% of local residents, and that the the vast majority of landlords have had to pay just £150 for a five-year licence. However its fee for new landlords is planned to rise to £400. Liverpool charges £400 for the first property and £350 for each additional property. 

 

 

[ Exerpt taken from  :  "13,000 Landlords fail to declare income"  see External Articles, and scroll down ]