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Non-UK Landlord Scheme in the UK
Non-Resident Landlords: Stop Losing Money on UK Rental Taxes!
Are you earning rental income from UK property while living abroad? If your usual place of abode is outside the UK, letting agents or tenants deduct basic rate tax (currently 20%) from your rental income before passing it on to you. However, under the Non-Resident Landlord Scheme (NRLS), you can apply to receive your rental income without tax deductions and only pay the due taxes later.
At UK Property Accountants, we assist overseas landlords in ensuring full compliance with HMRC requirements and managing their tax obligations efficiently.
Ready to Begin?
Understanding NRL Scheme with UK Property Accountants
At UK Property Accountants, we don’t just handle the basics. We guide you through completing the necessary forms—NRL1, NRL2, and NRL3—to ensure tax efficiency and full compliance with HMRC.
NRL1 - For Individuals
Form NRL1 allows non-resident individual landlords to apply for rental income without tax deductions at source. We assist with preparing and submitting your application to HMRC.
NRL2 - For Companies
Non-resident companies receiving rental income from UK property must fill Form NRL2. We help companies navigate their tax obligations and maintain compliance with HMRC.
NRL3 - For Trusts
If your UK rental income is managed through a trust, you must submit Form NRL3. Our specialists handle the necessary filings, ensuring your trust remains compliant with UK tax laws.
Defer Your Tax Payments
What Does the Non-Resident Landlord Scheme Do For Me?
Normally, letting agents or tenants are required to deduct 20% tax from your rental payments before passing them on to you. However, non-resident landlords can apply for gross rental income status, which allows them to receive their rent in full without automatic tax deductions. Instead, they declare their income through UK Self Assessment Tax Return
But are you a non-resident landlord for UK tax purposes? You are if you meet the following criteria:
- You live outside the UK for 6 months or more
- You own UK rental properties and earn income from them
- You are an individual, company, partnership or trust based overseas but are letting property in the UK
As a landlord, you most certainly need to know how much tax you’ll have to pay on your rental income.
Use our Free Rental Income Calculator and get an assessment of how much you owe.
If you don’t register for gross rent, your letting agent or tenant may be required to deduct 20% tax from your rental income, impacting your cash flow.
To fulfil legal obligation
To avoid penalties
It’s Best to Be Sure
It’s best to be sure about your residency status and Self Assessment Tax Returns so that you are not bothered by the tax authorities. So, why not use our exclusive forms below and guarantee compliance. They are free and easy to use.
Confirm Your Non-Resident Status
Non-Resident Landlord Scheme applies to, well, non-residents. But are you one? Use our residency status checker and be sure about your UK residency situation.
Vital for Non-Resident Landlords
You are required to file a Self Assessment Tax Return with HMRC if you earn rental income from properties in the UK. Fill out the form below to see how best to proceed.
Essential Information
Key Highlights of Non-Resident Landlord Scheme
As a non-UK landlord with UK property, you are required to pay tax on your rental income. The NRLS allows your UK letting agent or tenant to collect tax on your behalf, ensuring you stay compliant with HMRC.
Avoid Fines & Penalties
If you don’t register for gross rent, your letting agent or tenant may be required to deduct 20% tax from your rental income, impacting your cash flow. In addition, if you miss the 31 January deadline for filing your personal Self Assessment Tax Return (to disclose your non-deducted rental income, you could face penalties & interest charges. For more serious cases of non-compliance, you could even face prosecution and heavy fines.
Assistance We Provide
How UK Property Accountants Helps You in NRLS
At UK Property Accountants, we understand the unique challenges faced by non-UK landlords. Our dedicated team is here to make managing your UK property investment as tax efficient as possible. We provide support to ensure that your rental income stays in your hands, and you remain fully compliant with HMRC regulations.
We’ll prepare and submit your Self Assessment Tax Return accurately and on time, ensuring you comply with UK tax regulations.
Non-resident companies receiving UK rental income must comply with Corporation Tax obligations. We handle tax computations and file Corporation Tax returns (CT600).
Trusts receiving UK rental income must file a Trust and Estate Tax Return (SA900) with HMRC. We provide expert assistance in that.
Our Process
How We Work
Our work is centred around efficiency, collaboration, and delivering exceptional results to our clients.
Initial Discovery Call
We start with a straightforward process. Answer a few simple questions to help us understand your circumstances. It’s hassle-free, quick and designed to save you time.
Data Gathering & Analysis
Once we have the details, our team of experienced accountants gets to work. You can trust us to manage the complexities and ensure everything is accurate and compliant.
Thorough Review & Timely Submission
We conduct a meticulous review to ensure accuracy, compliance, and completeness in every submission. Our streamlined process guarantees timely submissions, so you never miss a deadline.
Ongoing Support
Our commitment extends beyond accounting and tax advisory work. We provide ongoing support, including tax planning and addressing accounting queries throughout the year.
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We are committed to helping you achieve financial prosperity while optimising your tax position in the most effective and efficient way possible.
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Latest News & Articles
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Our Articles Covering Non Resident Landlord Return
Our Latest News on Non Resident Landlord Return
FAQs
General queries by our clients related to Non Resident Landlord Return are answered here.
The Non-Resident Landlord Scheme (NRLS) is a tax system established by HM Revenue & Customs (HMRC) for individuals who rent out property in the UK but live abroad Under the scheme, tenants or letting agents are required to deduct basic-rate tax (currently 20%) from the landlord’s rent payments before they are transferred to the landlord. This deduction is then paid directly to HMRC. The scheme ensures that non-resident landlords comply with their tax obligations in the UK.
Non-resident landlords who want to receive rental income without tax deductions must apply for approval from HMRC. To apply, you need to register with HMRC by submitting appropriate form.
- NRL1 for individuals
- NRL2 for companies
- NRL3 for trustees (including corporate trustees)
This can be done online via the HMRC website or by completing a paper form. You will need to provide details about your rental property, your identity, and your tax status. Once approved, you can receive your rental payments gross (without tax deductions).
To be eligible for the NRLS, you must meet the following criteria:
- You must have UK rental income
- Your usual place of abode must be outside the UK
- You must not be liable to UK Income Tax on the rental income under any other provision of the Income Tax Acts
If you are a non-resident landlord (living outside the UK) and you rent out property in the UK, your rental income is subject to tax in the UK. Normally, if you are a non-resident landlord, the tax is deducted at source by a letting agent before you receive your rental income. However, if you want to receive the rental income without tax deductions, you must apply for approval from HMRC under the Non-Resident Landlord Scheme.
How it Affects Your Rental Income:
Without NRLS Approval: If you haven’t been approved under the NRLS, the letting agent or tenant will deduct tax (usually at 20%) from your rental income and pay it directly to HMRC.
With NRLS Approval: If HMRC approves you, you can receive the full rental income without any tax deductions. You must, however, handle your tax obligations through self-assessment and pay the tax due directly to HMRC.
If you don’t register for the NRLS, your UK rental income could be taxed at a higher rate. When registered, your letting agent or tenant will only need to deduct 20% tax from your rent, and you won’t need to report that income in your self-assessment. Not registering could also lead to penalties and interest charges from HMRC. To avoid paying extra tax and stay compliant with UK tax rules, it's important to register for the scheme.
Have more questions? Check out our Complete Guide for everything you need to know about Non Resident Landlord Return in one place.
UK Property Accountants is a leading firm of chartered certified accountants and chartered tax advisers specialising in the property and real estate sector with head office in Central London.
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