Overseas landlords

The Non-resident Scheme is a scheme for taxing the UK rental income of non-resident Landlords.

The term ‘ non-resident landlords’ include individuals, companies and trustees who have:

  • A UK rental income and
  • A ‘usual place of abode’ outside the UK.  In the case of individuals, this is regarded as an absence from the UK for 6 months or more.

The scheme requires UK Letting Agents to deduct Basic Rate Tax ( currently 22% ) from any rent collected for non- resident landlords, if non-resident Landlords do not have a UK Letting Agent acting for them or if a ‘let only’ service is provided, and the rent is more than £100.00 per week, their tenants must deduct the tax.  In calculating the amount to tax, the letting agent or tenants take into account any allowable deductible expenses they pay in the quarter.

For non-resident Landlords to be able to receive rents with no tax deducted, they must successfully apply to the Inland Revenue for approval.  If successful, a notice of approval will be sent to the non-resident Landlord and a separate notice sent to us, the Letting Agent, authorising us to pay rent without deducting tax.  Please note that even though rent may be paid with no tax deducted it is still liable to tax and therefore must be included in any tax return.

For further information and to download an application form please visit HMRC.