Three stories today, and none of them are really about the headline number. HMRC’s second-biggest landlord tax haul in years turns out to be mostly ordinary people who never thought of themselves as landlords. New mortgage figures show approvals creeping back up in the same data release that shows the rate you’d actually pay creeping up too. And a lender’s survey of its own borrowers is being read as proof the whole HMO sector has EPC C sorted, which isn’t quite what the numbers say. Read past the top line before you act on any of them.
£104m in landlord tax is mostly people who didn’t know they were landlords
HMRC recovered £104.3 million in unpaid tax from landlords in 2025/26, the third year running the total has topped £100 million, according to a Freedom of Information request by accountancy firm Price Bailey reported by Mortgage Solutions on Tuesday. Landlords made 11,511 voluntary disclosures over the year, the highest number since 2018/19, though the average payment fell to £9,063 from a record £13,713 the year before — more people caught, each owing less. Since the Let Property Campaign launched in 2013/14, it has brought in £674 million in total.
Andrew Park, tax investigations partner at Price Bailey, put the shift down to data rather than diligence: “HMRC’s data-matching capability has become relentless. Most voluntary disclosures are now prompted by HMRC nudge letters, and we are seeing a clear trend in larger numbers of smaller cases.” HMRC is increasingly cross-referencing Land Registry records against tax returns to flag people who own more than one residential property, and Park says a large share of those caught are what he calls accidental landlords — people who kept a flat after moving in with a partner, inherited a property, or let a home out while working abroad, often genuinely unaware they had a taxable profit to declare.
My read: this is the same failure pattern I see on the compliance side of the job, just with a different regulator attached. Someone who inherited a parent’s flat and let it to cover the mortgage rarely thinks of themselves as “a landlord” in the way the rules do — and the label doesn’t just carry a tax obligation, it carries an EPC that needs to be valid, a gas safety record, and possibly an HMO licence if the arrangement is more informal than it looks on paper. Nobody in that position sets out to break rules; they just never got the memo that letting a spare property, however casually, switches on a full set of them at once.
If any of that describes you — a property you kept rather than chose, being let without much formality — check two things this week: whether HMRC needs telling, and separately whether the EPC and safety paperwork on that property is still valid. A voluntary disclosure to HMRC attracts a materially lower penalty than one prompted by an investigation, and the same logic applies everywhere else: fixing a compliance gap before someone else finds it is always the cheaper version of the conversation.
Approvals recovered in June. So did the rate you’d pay for one
The Bank of England’s Money and Credit release for June, published Wednesday and reported by Mortgage Solutions, showed net mortgage approvals for house purchase rising to 58,200 from a revised 56,600 in May, though still below the six-month average of 61,400. Remortgage approvals edged up to 34,200, and net mortgage borrowing more than doubled to £7.7 billion from £3.3 billion the month before. The detail that matters more than any of those counts: the effective interest rate on newly drawn mortgages rose to 4.35% from 4.22%, its highest level in more than a year, while the rate on the outstanding stock of all mortgages hit a record 3.96%.
Nathan Emerson, CEO of Propertymark, read the approvals figure as tentatively encouraging: buyers “responded positively to a period of relative economic stability,” though activity “remained below the average recorded over the previous six months.” Mark Harris, chief executive of SPF Private Clients, was more direct about the rate move, warning that borrowers “may want to consider securing a product sooner rather than later” given the direction of travel.
My read: this data release supports two completely different headlines depending which figure you lead with, and most of the coverage I’ve seen this week leads with the one that sounds better. Approvals recovering is real, but it’s recovering into a market where the cost of borrowing to act on that approval went up in the same month. For a homebuyer or landlord about to instruct a survey ahead of a purchase, the practical read isn’t to panic about a market that’s still functioning — it’s that a rate held today isn’t guaranteed to be there in a fortnight, and a quiet-looking market is not the same thing as a static one.
If you’re mid-purchase or due to remortgage in the next few months, get a rate locked rather than waiting to see if it dips — the direction this data shows is up, not down. If a landlord’s plan for funding EPC or retrofit works relies on remortgage headroom, budget against the higher effective rate now rather than the one quoted when you first costed the job.
HMO landlords say they’re ahead on EPC C. Worth asking who was actually asked
Research from Paragon Bank, covered by Mortgage Solutions on Tuesday, found more than 60% of HMOs owned by the landlords it surveyed already hold an EPC rating of A to C, against roughly half of the wider housing stock, with none of the respondents reporting a property in the bottom F or G bands. More than a quarter said they had already brought forward energy-efficiency improvements ahead of the proposed 2030 deadline for MEES to require EPC C, and over four in ten said they were absorbing rising energy costs rather than passing them on to tenants. Louisa Sedgwick, Paragon’s managing director of mortgages, called energy efficiency “a core part of how HMO landlords operate,” adding that “many are already ahead of proposed standards.”
My read: the direction is probably genuine — an HMO with several tenants and shared bills gives a landlord more reason to care about running costs than a single let does — but the sample is worth naming for what it is. These are Paragon’s own mortgaged HMO borrowers, which by definition means professional, portfolio landlords who took out a specialist buy-to-let product and were willing to respond to their lender’s survey. A genuinely representative slice of the HMO sector — including the smaller, unlicensed end I see on inspections, where a room has been let off without much thought to any of the paperwork — would not produce a zero-F/G result. This is a lender’s book, presented with real numbers inside it, not a survey of the sector.
If you own an HMO and it isn’t already at C, a friendly sector-average headline like this one shouldn’t be the thing that reassures you. Get a current EPC done, and if it comes back D or below, get a proper retrofit assessment rather than assuming you’ll catch up before 2030 the way the coverage implies everyone else already has.
What I’d actually do
- Kept or inherited a property you don’t really think of as “rental”? Check whether HMRC needs telling before a nudge letter arrives — a voluntary disclosure costs less than one prompted by an investigation.
- Letting something informally — a room, an annex, a flat you fell into renting out? Confirm the EPC and gas safety paperwork on it is still valid; the same blind spot that misses a tax return usually misses these too.
- Mid-purchase or due to remortgage soon? Lock a rate now rather than waiting — this week’s data shows the cost of borrowing moving up, not down.
- HMO landlord not yet at EPC C? Book an assessment regardless of what a lender’s press release says the sector average looks like; 2030 won’t care whether your peers got there first.
If today’s stories have you wondering whether a property’s paperwork — EPC, safety records, HMO status — actually stacks up, the practice offers EPC assessments across the South East, alongside wider retrofit advice. Get in touch.
Small print. General commentary, not advice for your specific circumstances — regulations, schemes and deadlines change, and your property is not the average property. Sources linked were accurate when read on 30 July 2026.