Non–UK Resident Landlord Scheme (NRLS)
The Non-Resident Landlord Scheme (NRLS) is administered by HM Revenue & Customs (HMRC) and applies to landlords who live outside the UK but earn rental income from UK properties. The scheme ensures that non-resident landlords meet their UK tax obligations in a structured and manageable way.
How the Scheme Works:
Letting agents or tenants paying rent to a non-resident landlord are legally required to deduct basic rate income tax from the rental payments and send it to HMRC. This deduction serves as an advance payment towards the landlord’s overall UK tax liability.
However, non-resident landlords can apply for exemption from this withholding tax. If approved, HMRC will instruct the letting agent (or tenant) to pay rent without deduction, and the landlord is registered for Self Assessment, if not already registered.
Why Tax Return Filing is Important
Many non-resident landlords benefit financially by filing UK tax returns, even when tax has already been deducted:
UK Personal Allowance: Letting agents or tenants cannot apply the landlord’s UK personal allowance when calculating tax, which means more tax is deducted than necessary. A tax return allows you to reclaim or offset this overpaid tax.
Unclaimed Expenses: Costs such as mortgage interest, ground rent, repairs, and maintenance paid directly by the landlord cannot be considered by letting agents. Through your tax return, we can claim these deductions.
In most cases, the result is a tax refund or reduction, and in future years, tax will only be due on profits that exceed your personal allowance (where applicable).
Our NRLS Service Includes
- NRL Scheme Registration
We handle your registration with HMRC, submitting all required details—name, home and UK letting address, letting agent info, and Tax Identification Number if already registered for Self Assessment.
- Tax Withholding Management
We ensure that any tax withheld by agents or tenants is properly recorded and applied to your tax account.
- Tax Return Preparation
We complete and file your UK tax return, accurately reporting your rental income, allowable expenses, and tax residence status to ensure compliance and optimal tax efficiency.
- Claiming Exemptions and Deductions
We apply all valid deductions, including expenses like mortgage interest, agent fees, insurance, repairs, and more—to reduce your tax bill.
- Double Taxation Relief
If you live in a country with a Double Taxation Agreement with the UK, we can help you claim relief, ensuring you’re not taxed twice on the same income—especially where pension income or other UK income could increase your overall tax exposure.
