HMRC is targeting landlords in an attempt to recoup an estimated £500 million in unpaid tax a year
The taxman will write to 40,000 landlords it suspects of avoiding tax on their buy-to-let investment over the next four months.
It will ask targeted landlords to contact them to sort out their tax affairs, or risk a large fine or criminal investigation if they have been found to have broken the rules.
Landlords have just 30 days to reply before action is taken.
An estimated 5,000 landlords have already been sent the letters, according to a report in The Sunday Telegraph.
This is part of an ongoing campaign targeting property owners that started last October, but now HMRC is getting tougher, accountants say.
The Revenue estimates that £500 million a year in tax goes unpaid each year, with tens of thousands of landlords paying little or no tax on rental income and capital gains on second properties.
As well as targeting landlords and undeclared rental earnings, it is also targeting those who have filed inaccurate tax returns.
Tax inspectors will scrutinise housing benefit payments and social media, as well as traditional sources such as the Land Registry and electoral roll.
Landlords who advertise their property to friends online may be targeted if they are suspected of avoiding tax on their income.
Fewer than 500,000 taxpayers are registered as owning second properties, yet the true number of landlords could be as high as 1.5 million, the Revenue estimates.
It is now offering landlords a simple message: come to us before we come to you.