Tax for non-resident landlords

Apply to HMRC for approval to receive rent with no tax deducted, online or on form NRL1 if you're an individual, NRL2 for a company or NRL3 for trustees. HMRC will usually approve if your UK tax affairs are up to date, you've had no UK tax obligations before, or you don't expect to owe UK income tax for the year. Once approved, HMRC tells your agent or tenant directly.

Yes. Approval to receive rent gross only changes how the tax is collected, not whether it's due. Individual non-resident landlords normally still file a Self Assessment return each year, declaring the rental profit and paying any tax by the usual deadlines. If you're late with returns or payments, HMRC can withdraw your approval, and your agent will have to start deducting tax again.

For the scheme, an individual whose usual place of abode is outside the UK, which HMRC treats as living abroad for more than six months of the year. That's not the same test as tax residence, so you can be a non-resident landlord under the scheme while still being UK tax resident. For companies and trustees, the scheme also looks at their usual place of abode.

Only if the rent is more than £100 a week. A tenant paying a landlord who lives abroad more than that, with no letting agent involved, must deduct basic-rate tax from the rent, pay it to HMRC quarterly and give the landlord a certificate after the tax year. Many tenants don't know this, so landlords without an agent usually apply to receive rent gross to avoid problems.

For 2026/27, basic-rate income tax of 20%, applied to the rent less allowable expenses the agent pays. From 2027/28 HMRC says the deduction will be at the new property basic rate of 22%. The tax deducted isn't a final charge: you claim credit for it on your Self Assessment return, so you may get some back if your liability is lower, or pay more if it's higher.

Some non-residents can. British citizens, citizens of a European Economic Area country and people who've worked for the UK government during the year are entitled to it, and some double tax agreements give the same right. If you qualify, the first £12,570 of your UK income can be tax-free. You claim it through your Self Assessment return.

Yes. The mortgage interest restriction applies to individuals whether or not they live in the UK, so a non-resident landlord with a UK buy-to-let mortgage gets the basic-rate tax credit rather than a deduction. If your UK income is modest and you qualify for the personal allowance, the effect may be small. A company owning the property, including a non-UK company, deducts interest under the corporation tax rules instead.

Yes. Non-residents must report every disposal of UK land and property to HMRC within 60 days of completion, using a UK property return. That applies even if there's no tax to pay or you've made a loss. Any capital gains tax due is normally paid within the same 60 days. Missing the deadline brings penalties and interest, so it's worth planning before you exchange.

Often. Non-residents only came into UK capital gains tax on residential property from April 2015, and on commercial property from April 2019. If you owned before then, you can usually measure the gain from the market value at that date, rather than what you paid, or use other methods if they give a better result. That can remove much of the gain, so old valuations are worth finding.

Often, yes. Since 1 April 2021, buyers who aren't UK resident pay an extra 2% SDLT on residential purchases in England and Northern Ireland. For individuals, you're non-resident for this purpose if you weren't present in the UK for at least 183 days in the 12 months before buying. It's added on top of the 5% higher rates for additional properties, so a non-resident buying an additional property can pay 7% above standard rates.

Possibly. If you're an individual and you spend at least 183 days in the UK in a continuous 365-day period within the year after your purchase, which can start up to a year before it, you can usually claim the 2% back. The claim has a time limit, so if you're planning to move, keep a record of your days in the UK from the start.

Since 6 April 2020, non-UK resident companies pay UK corporation tax, not income tax, on profits from UK property. That brings corporation tax rates, corporation tax returns and corporate rules on interest and losses. The non-resident landlord scheme still applies, so agents and tenants may still deduct tax unless the company is approved to receive rent gross, with any tax deducted credited against the company's corporation tax.

Not for UK homes. Since April 2017, shares in an overseas company or interests in a partnership are within UK inheritance tax to the extent their value comes from UK residential property. So enveloping a UK buy-to-let in an offshore company doesn't take it out of your estate. UK property held directly is within inheritance tax wherever you live, so non-resident landlords need planning too.

Usually not in full. The UK taxes rent from UK property whatever your residence, and many countries also tax their residents on worldwide income. Double tax agreements normally give the UK the first right to tax UK property income and require your country of residence to give credit for UK tax paid, or to exempt the income. The details vary by country, so check the treaty and local rules.

It depends on your income, financing, plans and where you live. A UK or overseas company pays corporation tax on rental profits and deducts interest in full, but faces the 2% non-resident surcharge if it's non-resident or controlled by non-residents, possibly ATED, and tax again when profits reach you. Your country of residence may also tax company profits or dividends differently. We compare both with your figures.

You leave the non-resident landlord scheme, so tell your agent and HMRC, and rent is paid without deduction. You stay in Self Assessment and are taxed on your worldwide income once UK resident again, depending on the statutory residence test and any split-year treatment. If you'll move back into a property you let, private residence relief and the timing of a later sale need thinking about.