Non-resident landlord calculator, 2026/27

How the Non-Resident Landlord Scheme works

The Non-Resident Landlord Scheme requires UK letting agents, or tenants paying more than £100 a week directly to a landlord based outside the UK, to withhold basic-rate tax from the rent before passing it on, unless HMRC has approved the landlord to receive rent gross. This withholding is a payment on account of the landlord's eventual UK tax liability, not the final tax bill itself.

Landlords can apply to HMRC (form NRL1 for individuals) to receive rent without withholding, provided their UK tax affairs are up to date, and instead settle any tax due through self assessment each year. This improves cashflow but does not remove the underlying obligation to file a UK tax return and pay the tax that is actually due.

How this is calculated

Rental profit (gross rent less allowable expenses such as letting agent fees, insurance, repairs, and, where relevant, the 20% mortgage interest tax credit) is added on top of any other UK income you enter and taxed using the standard 2026/27 income tax bands and personal allowance. The tax attributable to the rental profit is found by comparing total tax with and without that profit.

Where you are not approved to receive rent gross, the calculator shows the 20% basic-rate withholding your agent is likely to have deducted and compares it with your actual calculated liability, which can produce either a further balance due (if your marginal rate is above basic rate, or your personal allowance is restricted or unavailable) or a refund (if your actual tax bill is lower than the amount withheld).

Filing and compliance obligations

Non-resident landlords must generally complete a UK self assessment tax return each year regardless of whether tax was withheld at source, since the withholding is only a payment on account and the tax return is what finalises the actual liability, taking into account personal allowances, other income, and any reliefs.

Since April 2015 (extended in April 2019), non-resident landlords are also within scope of UK capital gains tax on disposals of UK residential and, later, non-residential property, which is separate from the income tax on rental profit modelled here and needs its own calculation and, usually, a 60-day reporting deadline after completion.

Do I still pay UK tax on rental income if I live abroad?

Yes. UK rental profit is taxable in the UK regardless of where the landlord lives, using the same personal allowance and tax bands as UK residents in most cases, subject to any relevant double taxation agreement between the UK and your country of residence.

What is the Non-Resident Landlord Scheme withholding rate?

Letting agents (or tenants paying rent directly above the threshold) generally withhold tax at the basic rate, 20%, from the rent unless HMRC has approved the landlord to receive rent gross under the scheme, after which tax is instead settled through self assessment.

Can I apply to receive my rent without deductions?

Yes, by submitting form NRL1 (for individuals) to HMRC, provided your UK tax affairs are up to date or you have never had any UK tax obligations before. Approval means your agent pays rent gross, and you settle tax due through your annual self assessment return instead.

Do I need to report capital gains if I sell the UK property?

Yes. Non-resident landlords have been within the scope of UK capital gains tax on UK property disposals since 2015 (extended to non-residential property in 2019), and there is normally a 60-day reporting and payment deadline after completion, separate from any income tax return.