Non-Resident Landlord Scheme (NRLS)

How the Non-Resident Landlord Scheme Works

The Non-Resident Landlord Scheme requires letting agents (or tenants, if there’s no agent) to deduct basic rate tax (20%) from rental income paid to landlords who live abroad, and pay it to HMRC.^[2]

Who Is a Non-Resident Landlord?

You’re generally treated as non-resident if your usual place of abode is outside the UK. This typically means you’re absent from the UK for 6 months or more per year.^[3]

How It Works

1. Your letting agent (or tenant) deducts 20% from the rent after allowable expenses
2. They pay the deduction to HMRC quarterly
3. You receive the net rent
4. You still file a Self Assessment return and claim credit for the tax already deducted

Applying to Receive Rent Gross

You can apply to HMRC using form NRL1 to receive your rent without deductions. HMRC will usually approve this if:^[3]

• Your Self Assessment record is up to date
• You’ve never had a tax compliance issue
• You don’t expect to owe UK tax (e.g. your expenses cover most of the income)

Approval doesn’t mean you’re exempt from tax — you still file SA and pay any tax due.

Filing a Self Assessment Return

Even with NRL deductions, you must file a Self Assessment return. On your return, declare your total rental income, claim allowable expenses, and get credit for any NRL tax already deducted.^[4] Income Tax filing software like GoFile lets you submit to HMRC from anywhere in the world.

Allowable Expenses

Non-resident landlords can claim the same expenses as UK-resident landlords: letting agent fees, insurance, maintenance, mortgage interest (as a 20% tax credit), and more.^[1]

Double Taxation

If your country of residence also taxes your UK rental income, you may be able to claim double taxation relief under a tax treaty to avoid being taxed twice on the same income.^[5]

Further Reading

• Property Income & MTD for Landlords
• Moving Abroad: Tax Residence & Obligations
• Mortgage Interest Relief for Landlords
• Foreign Income & Double Taxation