Non-resident landlord scheme and UK tax returns for landlords abroad

The Non-Resident Landlord Scheme in plain English

In short: if your usual home is outside the UK for 6 months or more a year and you let UK property, you are a non-resident landlord. Your letting agent, or your tenant if you have no agent and the rent is over £100 a week, must deduct basic rate tax from the rent and pay it to HMRC, unless HMRC approves you to receive the rent gross.

Receiving rent without tax deducted

You can apply to HMRC on form NRL1 (individuals), NRL2 (companies) or NRL3 (trustees). Once approved, HMRC tells your agent or tenant to pay the rent in full. You must then keep your UK tax affairs up to date and file a UK Self Assessment return each year.

Your UK tax return

• Rental income and allowable expenses, such as agent fees, repairs and insurance.
• Mortgage interest as a 20% tax credit for individuals.
• Tax already deducted under the scheme, shown on the NRL6 certificate your agent gives you, is credited against your bill.
• Non-residents can often still claim the UK personal allowance, for example if they are UK or EEA nationals.

Selling UK property while living abroad

Non-residents must report the sale of any UK property or land to HMRC within 60 days of completion, even if no tax is due. See our guide to non-resident Capital Gains Tax and the 60-day rule.

Behind with UK rental income?

If rent has gone undeclared, the Let Property Campaign lets you put it right with lower penalties.