Non-UK Resident Landlords

If you are looking at doing business in the UK, it makes sense to work with professional advisers experienced in this field. At Hallys & Co, we offer international services for:

  • Overseas businesses with UK companies
  • Overseas companies with UK branches or subsidiaries
  • Non-UK resident landlords.

Non-UK Resident Landlords (NRL’s)

Non-resident landlords are persons:

  • who have UK rental income, and
  • whose ‘usual place of abode’ is outside the UK.

For these purposes individuals, companies and trustees can be non-resident landlords. For partnerships, each partner is treated as a separate landlord.

Most people who are not resident in the UK are not liable to UK tax and do not have to complete a tax return. The most common exception to this rule is landlords who let properties in the UK.

The default position is that a non-resident landlord is required to have basic rate tax deducted at source from gross rents. Where the property is managed by a letting agent, the agent is legally responsible for withholding the tax at source and paying this over to HMRC. If the property is not managed by a letting agent, the tenant should be withholding tax from the rents due.

For the landlord, the drawback of the above system is that tax is deducted from gross rents. Therefore, tax collected is on the income before deduction of expenses, like mortgage interest. Furthermore, the majority of non-resident landlords are entitled to a personal allowance under the Double Taxation Agreement between the country they are resident in and the UK. The implication is that it is possible to pay considerably more tax than required.

A non-resident landlord is required to complete a UK Tax Return, the same as UK resident landlords. A Tax return will calculate the tax liability and account for tax deducted at source.

The landlord can apply to receive rents without deduction of tax at source. This process, known as the non-resident landlord scheme, could provide a distinct cash flow advantage.

Hallys & Co are here to help. We deal with many non-resident landlords. We can assist with applications to have rents deducted gross, complete your UK Tax Return and advise on the best ways of minimising tax and avoiding penalties. Our document exchange facility will also allow you to approve Tax returns online without the requirement for a physical signature.

Call now to speak to a business advisor on 020 8732 5577 or send us an email on to arrange a free, no obligation consultation.

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