A simple guide to HMRC’s “nudge letter” when you have assets in Italy and Spain

“I thought it was a parking fine.”

Rodrigo has lived in London for years. Back in Genova, he still owns the small flat he inherited from his aunt—rented informally to a family friend. He also shares a joint current account with his mother at an Italian bank (“just in case”), and he once opened a savings pot in Spain during a short stint in Barcelona.

Life moved on. Paperwork didn’t.

Then the brown HMRC envelope arrived:

“We have information about your overseas income or assets… please review your tax position.” 

His first thought: Am I in trouble?

First things first: what this letter is (and isn’t)

• It’s commonly a “nudge letter.” HMRC sends these to prompt people to check their returns.
• On its own, it’s not a formal investigation.
• Ignoring it can, however, invite a formal enquiry.

Why Rodrigo (and people like him) get one

Because tax authorities increasingly share data. Italian and Spanish banks, brokers, and insurers routinely report balances and income under global information-exchange rules. Even small interest or dividends can show up on HMRC’s systems.

How UK tax looks at Rodrigo’s mix (plain English)

• Italian rental (Genova flat). If you’re UK-resident, UK tax generally applies to your worldwide income. Any Italian tax paid on the rent can often be credited against UK tax to avoid double taxation—but the income still needs to be declared in the UK.
• Joint Italian bank account. HMRC cares about beneficial ownership. If your name is on the account, your share of the interest belongs on your UK return—even if “it’s mostly mum’s money.”
• Spanish savings. Bank interest (sometimes with Spanish withholding) is still reportable in the UK, with relief available where the rules allow.

The aim isn’t to panic—it’s to get the years straight, gather the numbers, and correct anything missing.

Your three safe paths

A) Everything is already correct.
Good news. You (or we) can reply appropriately. If HMRC enclosed a “certificate of tax position,” remember: there’s no legal obligation to sign it. Don’t sign anything you’re unsure about—write back instead.

B) You spot gaps or mistakes.
Use HMRC’s Worldwide Disclosure Facility (WDF). You notify HMRC first, then you have a strict (short) deadline—typically around 90 days—to submit the full disclosure (calculations, short narrative, and payment). Extensions are possible for complex cases.

C) It’s big or long-running.
Still disclose—just expect HMRC to look further back and consider penalties. The sooner you cooperate, the better the outcome usually is.

What to do this week (10-minute triage)

1. Make a list of assets: the Genova flat, the joint Italian account, the Spanish savings.
2. Create a year-by-year timeline: when the rent started, the interest/dividends by UK tax year, where you lived each year.
3. Collect statements and any Italian/Spanish tax certificates.
4. Don’t sign an HMRC certificate or make statements you’re unsure about—get advice first.

How a WDF disclosure actually works

• Step 1 – Notify. Tell HMRC online that you’ll disclose. You’ll receive reference numbers and a deadline.
• Step 2 – Build. Calculate any extra UK tax, add interest, and determine the penalty band (which depends on behaviour and whether HMRC’s contact prompted the disclosure).
• Step 3 – Submit & pay. Send the figures and short explanations; pay or agree a time-to-pay plan if needed.

Why act now? Because with a nudge letter, HMRC has already connected you to overseas data. Proactive, accurate disclosure typically leads to a faster, cleaner resolution—and smaller penalties—than waiting.

A realistic outcome

For a profile like Rodrigo’s, we’d rebuild five to six UK tax years. The Genova rent is pulled together from bank records and informal notes; we credit Italian tax correctly in the UK; the joint-account interest is split fairly; Spanish interest is included with any withholding considered. We submit a WDF disclosure, explain the mistakes were non-deliberate, and cooperate fully. HMRC accepts; case closed.

Need a calm plan in days, not months?

That’s what we do.

• Rapid nudge-letter triage  
• Year-by-year rebuild of Italian/Spanish income and interest.
• Double-tax relief done correctly—no “tax twice” mistakes.
• Disclosure drafting and submission through WDF, end-to-end.

Contact us:

• Website: www.vectigalistax.co.uk 
• Email: angelo@vectigalistax.co.uk

We’ll come back with a clear set of steps to put this behind you.

General information only; not tailored advice. Tax outcomes depend on your facts and the rules in force for the relevant years.