Fri 28 Apr 2017 View all news articles

Are you an overseas landlord?

In an ever growing rental market we are encountering an increased number of landlords based overseas. Any landlord who lives abroad for more than 6 months of the year must pay tax on any income they get from renting out properties in the UK. 

Though you can apply to have UK rental income without deduction of UK tax!

Karl Tatler Lettings implement the Non-Resident Landlord (NRL) Scheme. Essentially the scheme is for taxing the UK rental income of persons whose ‘usual place of abode’ is outside the UK. As such lettings agents must deduct tax from the landlords UK rental income and pay the tax to HMRC’s Accounts Office.

However you can apply for approval to receive your rental income with no tax deducted. On the basis that;
- Your UK tax affairs are up to date; or
- You have never had any UK tax obligations; or
- You do not expect to be liable to UK tax for the tax year in which the application is made.

The application must be made on one of the following forms, NRL1i for individuals and NRL2i for a company. A link to the form can be found at the foot of this article. If the application is successful, (don’t worry, as around 95% of all applications are approved and most submissions are dealt with in around a 2 week time frame) the Inland Revenue will issue an NRL8 certificate to Karl Tatler Lettings. 

One important note to consider, one certificate is required for per person, for example if Mr and Mrs, or several landlords, all parties must apply for an individual certificate.

A common question from landlords being based in Northern Ireland, is whether they are classed as overseas. Northern Ireland and Isle of Wight are NOT classed as overseas. Whereas Southern Ireland, the Isle of Mann and the Channel Islands are class as overseas. You can find details here.

As leading Wirral estate agents and lettings agents we have plenty to talk about and like to give our opinions on a few things too! Read about what we have to say, our latest news and industry news.