Services

Non-resident landlord tax returns

If you live overseas, UK tax on rental property is easy to get wrong and easy to overpay. The return still has to be filed.

Who this is for

If you live overseas you may find dealing with UK tax matters time consuming and confusing. Knowing what you need to do means you meet your obligations as a non-resident landlord and stay as tax efficient as possible.

The tax return

UK non-resident landlords normally need to complete a tax return. When you register with HMRC as a landlord you are set up in Self Assessment. A tax return has to be completed in each tax year unless HMRC tells you otherwise, and it has to be on time and correct or penalties follow.

Rebates

If you paid tax on rental income and earned less than the tax-free allowance, you can claim a tax rebate. A claim can cover the previous four tax years. This is common where a letting agent collects the rent: tax is deducted at 20% unless HMRC has allowed you to join the non-resident landlord scheme.

The non-resident landlord scheme

The scheme is operated by HMRC and taxes the rental income of UK non-resident landlords. Letting agents deduct tax from rent they collect unless the landlord has approval to receive the rent with no UK tax deducted. If you have lived outside the UK for more than six months you will generally be classed as non-resident for the scheme. If you have not applied for the exemption, your letting agent should supply a certificate of tax liability each year.

Expenses

A landlord can offset some of the costs of buying and running a property, such as mortgage interest and property repairs, through Self Assessment, which is also where other UK income is declared. Capital expenditure, for example fitting a bathroom or kitchen, can be considered against capital gains tax when the property is sold. Non-resident landlords should also consider whether they are entitled to UK pension tax relief on tax paid on UK pension income and lump sums.

What we do

We complete the tax return, claim back tax paid on rental income for up to the last four tax years, and make sure you do not pay more tax than you need to.

Included

• Complete your tax return
• Claim back tax paid on rental income for up to the last four tax years
• Make sure you do not pay more tax than you need to