My father in law is a pensioner living off state pension only but supplementing his income with a very moodest income from a rental property. It has just come to light that he has not filed ANY tax returns since he bought the property outright in 2006.. believing wrongly, that since he had no tax liability he wasnt required to file returns ! I am tax literate and have prepared his accounts to date..and indeed he has had no liability for income in any of these years ( his combined pension and rental income being below his personal allowances each year). However it now looks like, if he is discovered, he could receive a penalty from HMRC for each year he did not file a return..and I believe this works out at £1600 for each year not filed. Would it be wise to come clean under the HMRC "Let Property" scheme ..and if so what penalty do you think he will get away with...£1600 for each of the 12 years seems extreme ! It looks like his actions would be deemed as "wilfull" and the HMRC site suggests they would go back up to 20 years and since no actual tax is owed , it seems that there would not be a reduction of the penalty under the scheme. Any help would be really appreciated as it is causing him worry and he is 86 years old !