Letting a UK property while you live abroad: the Non-Resident Landlord Scheme, and how to be paid gross

In England, you can let a UK property while living abroad, but the tax withholding rules are UK-wide and sit alongside each nation’s landlord-registration, tenancy-address and licensing rules. The Non-Resident Landlord Scheme is not an overseas landlord tax exemption; it is mainly a mechanism for paying rent gross instead of having basic-rate tax withheld.

Can you rent out your UK house if you live abroad?

Yes, you can rent out your UK house if you live abroad, provided you meet the ordinary letting rules for the part of the UK where the property is and deal with the Non-Resident Landlord Scheme for UK tax. UK tax law expressly allows a UK property business to be taxable even where the landlord is abroad: “Profits of a UK property business are chargeable to tax under this Chapter whether the business is carried on by a UK resident or a non-UK resident.” In England and Wales, an overseas landlord must give the tenant an address in England and Wales for service of notices: “A landlord of premises to which this Part applies shall by notice furnish the tenant with an address in England and Wales at which notices (including notices in proceedings) may be served on him by the tenant.” In Northern Ireland, “all private landlords in Northern Ireland must register with the Landlord Registration Scheme,” and Scotland has its own landlord-registration regime. If you rent your house out and move abroad, your mortgage and insurance may also need consent before the tenancy starts.

Who counts as a non-resident landlord, and is that the same as being non-resident for tax?

A non-resident landlord is someone whose usual place of abode is outside the UK, and that is not the same test as being non-resident for tax under the statutory residence rules. The statutory definition of non-resident landlord income refers to “income of a person whose usual place of abode is outside the United Kingdom,” and HMRC’s manual states the point directly: “Although the title of the scheme refers to 'non-resident' landlords, it is usual place of abode and not residence for tax purposes that determines whether a landlord is within the Scheme or not.” That means you can be classified as a non-resident landlord by HMRC even if you remain UK-resident for wider tax purposes. HMRC’s practice says the scheme applies where a landlord is outside the UK for a period expected to exceed more than six months, while GOV.UK elsewhere says 6 months or more per year; the safer legal answer is that the statutory test is usual place of abode outside the UK.

Does your letting agent or your tenant have to deduct tax from your rent?

Your letting agent must normally deduct basic-rate tax from net rent paid to a non-resident landlord unless HMRC has approved gross payment; a direct-paying tenant must normally deduct only where the rent exceeds £5,200 a year, unless HMRC tells them otherwise. The agent rule has no small-rent threshold because HMRC says: “There is no de minimis limit for rent paid to a landlord via a letting agent.” For tenants, the legislation applies where the occupier pays sums “exceeding in the aggregate £5,200 per annum,” so exactly £5,200 a year is not over the statutory threshold. The withholding rate is the basic rate — currently 20% — applied to net rent, not gross rent. HMRC’s gross-payment approval changes the deduction duty only: “Letting agents and tenants do not have to deduct tax from the rental income of a non-resident landlord, if HMRC has told them in writing that the landlord is approved to receive the rental income with no tax deducted.” Agent fees are commercial: Knight Frank’s 2026 list shows £450 plus VAT, £540 including VAT, annually for NRL HMRC returns.

How do you apply to have your rent paid gross, and what form do you use?

An individual non-resident landlord applies to HMRC on form NRL1 to receive UK rental income with no tax deducted; companies use NRL2, and trustees use the relevant trustee route. HMRC states: “Use form NRL1 if you are an individual non-resident landlord who wants to apply to receive UK rental income with no UK tax deducted.” The legal basis is that “A non-resident may apply to the Board for the obligation imposed under these Regulations to make payments to the Board not to apply,” and the application must be made “on a form provided by the Board.” If you want a tax agent to act for you, HMRC warns: “Do not use the online service if you want to authorise a tax agent to act on your behalf.” There is no HMRC fee in the NRLS regulations for applying to be paid gross, though advisers may charge; Taxeezy, for example, says: “We charge a one-off, flat fee of £50 for Non-Resident Landlord Scheme Applications.” Approval is not an exemption from UK tax, because HMRC says: “The granting of approval does not grant exemption from UK tax; any liability is dealt with under SA.”

If you never registered, who owes HMRC the tax that should have been deducted?

If no gross-payment approval existed, HMRC recovers the Non-Resident Landlord Scheme tax from the prescribed person who should have deducted it — normally the letting agent, or the tenant if the tenant was within the scheme — while the landlord still owes their own UK tax on the rental profit through Self Assessment. The regulations say that where tax should have appeared on a quarterly return but did not, HMRC “may make an assessment on the prescribed person to the best of their judgment in respect of that amount.” That means a tenant paying you direct for six months may be on the hook for the withholding shortfall if the statutory tenant threshold was met, and an estate agent collecting rent may be on the hook where the agent was the prescribed person. The landlord is not therefore tax-free: UK property profits remain taxable whether the business is carried on by a resident or non-resident. The person who pays HMRC under the scheme has a statutory indemnity right “to be indemnified by the non-resident for all such payments,” so the cash burden can still come back to the landlord.

Who files the non-resident landlord quarterly and annual returns, you or your agent?

The quarterly NRLQ return is filed by the prescribed person — normally the letting agent, or a tenant who is within the scheme — not by the landlord, and the annual return is also the prescribed person’s unless a statutory exception applies. Regulation 10 says that “within 30 days after the end of a quarter, a prescribed person shall make a return to the Board,” and HMRC tells tenants: “You must pay tax due each quarter to HMRC, using return form NRLQ.” The annual information return is due by 5 July: “Not later than the 5th July following the end of an annual period, a prescribed person, other than a person specified in paragraph (3) below, shall make a return to the Board for that period.” The important exception is narrower than some GOV.UK wording suggests: a tenant who had a gross-payment notice for the whole period is excluded, because the specified person is “any tenant who, as a result of a notice given by the Board under regulation 17(5)(b), was not obligated to make payments to the Board.” Letting agents still file NRLY annually: “If you’re a letting agent acting for landlords based outside the UK, you must fill in the NRLY annual return.”

Does the Non-Resident Landlord Scheme apply to companies?

Yes, the Non-Resident Landlord Scheme applies to companies as well as individuals where the company’s usual place of abode is outside the UK and it has UK property income. HMRC states the answer plainly: “Individuals, companies and trustees can be NRLs.” The statutory definition also covers income chargeable under the corporation-tax property-business rules, because it refers to profits under ITTOIA 2005 or “Chapter 3 of Part 4 of CTA 2009.” From April 2020, non-UK resident company landlords moved into Corporation Tax for UK property income, but HMRC confirmed: “The Non-residents Landlord Scheme will continue to apply to non-UK resident company landlords.” A non-resident company that wants rent paid gross uses NRL2: “Use form NRL2 if you're a non-resident company landlord who wants to receive UK rental income without deduction of UK tax.” But a UK-resident company is outside the scheme even if incorporated abroad: “companies regarded as resident in the UK for tax purposes do not have a usual place of abode outside the UK for the purposes of the Scheme.”

Are you a non-resident landlord if you are posted overseas with the armed forces?

Yes, armed forces personnel and Crown servants posted overseas are treated as non-resident landlords if their usual place of abode is outside the UK; HMRC says they are “treated the same as any other non-resident landlord.” That is the sharp point, because market guidance sometimes says service personnel are typically excluded, but HMRC’s published NRLS guidance says the opposite. The same usual-place-of-abode test applies: “Although the title of the scheme refers to 'non-resident' landlords, it is usual place of abode and not residence for tax purposes that determines whether a landlord is within the Scheme or not.” HMRC’s practice says that, although there is no statutory definition of usual place of abode, “the NRL Scheme will apply to all landlords outside the UK for a period that exceeds, or is expected to exceed, more than six months.” The NRL1 application is still an application for gross payment, not a separate general permission to let, and HMRC says non-resident landlords “have the option of applying for approval to receive their rental income with no tax deducted.” No special NRLS rule changes the answer because the tenant is a family member or the rent is reduced.

Last reviewed August 2026.

Sources

• ITTOIA 2005 s.269(1) — “Profits of a UK property business are chargeable to tax under this Chapter whether the business is carried on by a UK resident or a non-UK resident.” Source
• Landlord and Tenant Act 1987 s.48(1) — “A landlord of premises to which this Part applies shall by notice furnish the tenant with an address in England and Wales at which notices (including notices in proceedings) may be served on him by the tenant.” Source
• NI Direct, Landlord Registration Scheme — “By law, all private landlords in Northern Ireland must register with the Landlord Registration Scheme.” Source
• ITA 2007 s.971(2) — “income of a person whose usual place of abode is outside the United Kingdom” Source
• HMRC Property Income Manual PIM4850 — “Although the title of the scheme refers to 'non-resident' landlords, it is usual place of abode and not residence for tax purposes that determines whether a landlord is within the Scheme or not.” Source
• HMRC Property Income Manual PIM4810 — “There is no de minimis limit for rent paid to a landlord via a letting agent.” Source
• Income Tax (Non-resident Landlords) Regulations 1995 reg.3(5)(c)(ii) — “exceeding in the aggregate £5,200 per annum” Source
• HMRC NRLS guidance, What the Non-Resident Landlords Scheme is — “Letting agents and tenants do not have to deduct tax from the rental income of a non-resident landlord, if HMRC has told them in writing that the landlord is approved to receive the rental income with no tax deducted.” Source
• Knight Frank, Landlords Fees 2026 — “£450 (plus VAT) £540 (inc. VAT) annually.” Source
• HMRC NRL1 guidance — “Use form NRL1 if you are an individual non-resident landlord who wants to apply to receive UK rental income with no UK tax deducted.” Source
• Income Tax (Non-resident Landlords) Regulations 1995 reg.17 — “A non-resident may apply to the Board for the obligation imposed under these Regulations to make payments to the Board not to apply” Source
• Income Tax (Non-resident Landlords) Regulations 1995 reg.17 — “on a form provided by the Board” Source
• HMRC NRL1 guidance — “Do not use the online service if you want to authorise a tax agent to act on your behalf.” Source
• Taxeezy, Non-Resident Landlord Scheme Applications — “We charge a one-off, flat fee of £50 for Non-Resident Landlord Scheme Applications.” Source
• HMRC Property Income Manual PIM4810 — “The granting of approval does not grant exemption from UK tax; any liability is dealt with under SA.” Source
• Income Tax (Non-resident Landlords) Regulations 1995 reg.10 — “may make an assessment on the prescribed person to the best of their judgment in respect of that amount.” Source
• ITA 2007 s.971 — “to be indemnified by the non-resident for all such payments,” Source
• Income Tax (Non-resident Landlords) Regulations 1995 reg.10 — “within 30 days after the end of a quarter, a prescribed person shall make a return to the Board” Source
• HMRC NRLS guidance, Notes for tenants — “You must pay tax due each quarter to HMRC, using return form NRLQ.” Source
• Income Tax (Non-resident Landlords) Regulations 1995 reg.11 — “Not later than the 5th July following the end of an annual period, a prescribed person, other than a person specified in paragraph (3) below, shall make a return to the Board for that period—” Source
• Income Tax (Non-resident Landlords) Regulations 1995 reg.11(3) — “any tenant who, as a result of a notice given by the Board under regulation 17(5)(b), was not obligated to make payments to the Board” Source
• HMRC NRLY annual return guidance — “If you’re a letting agent acting for landlords based outside the UK, you must fill in the NRLY annual return.” Source
• HMRC Property Income Manual PIM4810 — “Individuals, companies and trustees can be NRLs.” Source
• ITA 2007 s.971 — “Chapter 3 of Part 4 of CTA 2009.” Source
• HMRC guidance note, income tax changes to NRLS regulations — “The Non-residents Landlord Scheme will continue to apply to non-UK resident company landlords.” Source
• HMRC NRL2 guidance — “Use form NRL2 if you're a non-resident company landlord who wants to receive UK rental income without deduction of UK tax.” Source
• HMRC Property Income Manual PIM4850 — “companies regarded as resident in the UK for tax purposes do not have a usual place of abode outside the UK for the purposes of the Scheme.” Source
• HMRC NRLS guidance, What the Non-Resident Landlords Scheme is — “Members of HM Armed Forces and other crown servants are treated the same as any other non-resident landlord.” Source
• HMRC Property Income Manual PIM4810 — “the NRL Scheme will apply to all landlords outside the UK for a period that exceeds, or is expected to exceed, more than six months.” Source
• HMRC Property Income Manual PIM4810 — “However, non-resident landlords (NRLs) have the option of applying for approval to receive their rental income with no tax deducted.” Source