​Entities included under the non-residents landlord scheme

The scheme covers not just individuals, but also companies, trusts and partnerships that let UK property and have a usual place of abode outside the UK.

When the non-residents landlord scheme does not apply

If you live in the UK (your usual place of abode is in the UK), then the non-residents landlord scheme does not apply.

For tenants / letting agents: if the rent paid is £100 a week or less (under £5,200 a year) and the landlord’s place of abode is in the UK, you typically do not need to operate the scheme.

What are the main obligations under the non-residents landlord scheme?

Who must operate the non-residents landlord scheme?

• If a letting agent collects rent on behalf of a non-resident landlord, they must operate the non-residents landlord scheme, regardless of how much rent is collected (unless HMRC authorises gross payment).

• If there is no letting agent, then the tenant becomes responsible if the rent paid to the non-resident landlord exceeds £100 a week.

Registration, deduction and reporting obligations

Under the non-residents landlord scheme:

• The letting agent or tenant must register with HMRC within 30 days of being required to operate the scheme.

• They must deduct basic rate tax (currently generally 20%) from the rental income before paying it to the landlord, unless HMRC has authorised the landlord to receive gross payments.

• Tax must be paid to HMRC within 30 days of each quarter end (quarters ending 30 June, 30 September, 31 December, 31 March).

• They must send a report to HMRC by 5 July after the end of the tax year using form NRLY and issue the landlord with a certificate of tax deducted (form NRL6).

Tax calculation under the non-residents landlord scheme

When operating the non-residents landlord scheme, the tax deduction is made on the rental income less any allowable deductible payments (expenses) paid by the letting agent or tenant which are reasonably deductible in computing the profits of the landlord’s UK property rental business.

What are the tax rates and other key rule changes for 2025/26 under the non-residents landlord scheme?

Tax rates and personal allowance

For the 2025/26 tax year, the UK personal allowance remains at £12,570.

The income tax bands are:

• 20% (basic rate) on income between £12,571 and £50,270

• 40% on income between £50,271 and £125,140

• 45% on income above £125,140.

Corporation tax for companies under the non-residents landlord scheme

If a non-resident company lets UK property, from April 2020 onwards the profits from that property business are subject to UK corporation tax, aligning more closely with UK resident companies.

Gross payment status update

Under the non-residents landlord scheme you may apply to receive rent gross (no deduction) if you meet conditions such as your UK tax affairs are up to date and you don’t expect a UK tax liability for the year.

Note: having received gross payment status does not mean you are exempt from UK tax—it means you receive the full rent and settle tax through self-assessment.

Registering and contact details updated

If you need to register or have enquiries about the non-residents landlord scheme, you can contact HMRC’s Non-UK Resident Landlords line: telephone 0300 322 9433 (outside UK: +44 300 322 9433).

Practical compliance considerations under the non-residents landlord scheme

Tips for non-resident landlords

• If you anticipate rental income from UK property and your usual abode is abroad, consider applying for gross payment status early to improve cash-flow.

• Maintain full records of rental income, expenses and tax deducted under the scheme (tenant/agent side) — the forms NRL6, NRLY etc must be kept for four years.

• Even if you receive rent gross, you still need to complete a UK self-assessment tax return (SA100 + SA105 + SA109 for individuals) or corporation tax return for companies.

• Be aware of foreign tax residence and double-taxation treaties — UK tax on rental income may still apply, and relief for foreign tax may be relevant.

Obligations for letting agents / tenants under the non-residents landlord scheme

• Letting agents must check the landlord’s residence status and whether the scheme applies. If required, they must register, deduct tax and file returns under the non-residents landlord scheme.

• Tenants paying rent directly to a non-resident landlord must check whether the scheme applies (rent > £100/week and no letting agent) and if so, register and deduct tax under the non-residents landlord scheme.

• Even when tax deductible, until HMRC gives approval for gross payment status, the deduction continues under the non-residents landlord scheme.

How Trueman Brown can help you

If you are a non-resident landlord (or letting agent/tenant dealing with such a landlord) and need assistance navigating the non-residents landlord scheme, our team at Trueman Brown is ready to help.

Whether it’s registering under the scheme, applying for gross payment status, advising on UK rental income tax returns or tracking deadlines, we have the expertise.

You can reach us by email: mark@truemanbrown.co.uk or by phone on 01708 397262. We’re based in Upminster, UK and serve non-resident landlords across the UK.

Frequently Asked Questions (FAQ)

Q1. What happens if the letting agent or tenant fails to operate the non-residents landlord scheme?
If the scheme is required but not operated (i.e., tax not deducted or not registered), then the letting agent or tenant may become liable for the tax that should have been deducted, plus interest and penalties.

Q2. Am I still taxed in the UK if I hold gross payment status under the non-residents landlord scheme?
Yes. Gross payment status simply allows you to receive rental income without deduction of tax at source. You still remain liable to UK tax on your UK rental income and must file a UK self-assessment or corporation tax return as appropriate.

Q3. Does the non-residents landlord scheme apply if I live outside the UK only three months a year?
Not necessarily. The key test is whether your “usual place of abode” is outside the UK. HMRC’s normal rule of thumb is an absence of six months or more suggests your usual place of abode is outside the UK. However each case is fact-sensitive.

Q4. If the rent is £90 per week, does the scheme apply?
If you pay rent directly to a non-resident landlord and the rent is £100/week or less, then the tenant typically does not have to operate the non-residents landlord scheme — unless HMRC specifically directs them to do so. However if a letting agent is involved, the agent must still operate the scheme regardless of rent amount.

Q5. What is the deadline for the annual return under the non-residents landlord scheme?
The annual information return (form NRLY) and certificate (form NRL6) must be sent by 5 July following the end of the UK tax year (which runs 1 April to 31 March) under the non-residents landlord scheme.

If you’d like to discuss your specific circumstances under the non-residents landlord scheme, or require help with registration, quarterly payments or tax returns, please get in touch – mark@truemanbrown.co.uk or 01708 397262.

This article is for general guidance only and does not constitute professional advice. Please contact a qualified adviser to review your personal circumstances.