Non-resident directors
Disregarded income caps a non-resident's UK tax on certain investment income. How the two calculations compare and when to claim the personal allowance.
Written and reviewed by Waqas Sagar Member of ICAEW, Fellow of ACCA, Fellow of AAT, a double graduate and entrepreneur at heart, helping startups grow and serving thousands of businesses nationwide with an excellent team. Published by LimitedCompany.Accountants, 12 London Road, Morden, London SM4 5BQ. Reviewed 12 September 2026 against 2026/27 UK rates and current Companies House and HMRC guidance.
Regulated by
Regulated & AML supervisor
AAT fellow member
Xero Gold PartnerCertified advisor
QuickBooks PartnerCertified ProAdvisor100+ yearsCombined team experienceFully insuredUp to £2m indemnityThe disregarded income rules cap a non-resident's UK tax on certain investment income, including UK dividends and interest. The liability is the lower of two calculations: one including the income with the personal allowance, one excluding it without the allowance.
The two calculations
What is and is not disregarded
The disregarded income rules cap a non-resident's UK tax on certain investment income, including UK dividends and interest. The liability is the lower of two calculations: one including the income with the personal allowance, one excluding it without the allowance.
Method one: include all UK income, claim the personal allowance if entitled, and tax normally. Method two: ignore disregarded income, lose the personal allowance, and tax only the remaining UK income, adding any tax treated as deducted at source from the disregarded income, which for dividends is nil.
The result is that a non-resident with only UK dividends often pays no UK tax at all, while a non-resident with substantial UK rental income may be better off claiming the allowance.
Dividends from UK companies, most UK interest, purchased life annuity payments and certain social security income are within the rules. UK rental income, UK employment income and trading profits from a UK permanent establishment are not, and are always taxable here.
Because the comparison depends on all your UK income for the year, it has to be recalculated annually rather than assumed from last year's answer.
Rates, thresholds and deadlines quoted here reflect the 2026/27 UK position and current Companies House and HMRC guidance. Check GOV.UK, or ask us, before relying on them for your own company.
Local help
We work with company directors across London and Surrey from our office at 12 London Road, Morden, London SM4 5BQ. Pick your area, or send the form below and we will call you back.
Frequently asked
No, the computation applies automatically in the return, but only if the software or preparer performs both calculations.
No. Gains have their own rules, and UK property gains are taxable for non-residents.
UK and EEA nationals and residents of many treaty states can. It is not universal, so check your treaty.
Keep bank statements, sales and platform reports, purchase invoices, payroll records, VAT workings, finance agreements and Companies House correspondence. We confirm the exact list at onboarding and identify gaps before a filing deadline becomes urgent.
The fee depends on transaction volume, record quality, VAT and payroll requirements, historic catch-up and the level of reporting needed. We agree a fixed scope and price before technical work starts, with published packages available on our fees page.
Yes. We request professional clearance, collect the prior records and authorities, check the next Companies House and HMRC deadlines, and give you one clear handover list. The process is normally completed remotely.
Yes. We work through secure cloud records, scheduled reviews and digital approvals, while keeping a named team available by phone, video call and email. Clients can also visit our Morden office by appointment.
We regularly work with Xero, QuickBooks, FreeAgent, Sage and connected sales or expense apps. The right setup depends on transaction volume, integrations and the reports you need, not simply the software brand.
The relevant calendar may include annual accounts, Corporation Tax payment and return dates, confirmation statements, VAT returns, payroll submissions and Self Assessment. We map the dates from your company year end and registrations.
No. This page explains general UK rules and common accounting treatment. Your facts, contracts and wider tax position must be reviewed before you rely on a conclusion.
Included approach
Check the current rules
Deadlines, thresholds and filing rules change. GOV.UK and Companies House publish the current statutory position; advice should then be applied to your company’s circumstances.
Talk to an accountant
Share your next deadline, accounting problem or growth question. We will reply with a clear next step and quote any technical work before it begins.
Chat with ACCOTAX on WhatsAppPick a time that suits you and a qualified accountant will call you about your company, deadlines and fees.
Appointments run Monday to Friday, 9:00am to 5:30pm. Your confirmation is emailed straight away.
Four London offices
Work with us entirely online, or sit down with your accountant at whichever office suits you. Open Monday to Friday, 9:00am to 5:30pm. Office visits are by appointment only, so please book before coming in.
Free, no obligation
Pick a time that suits you and a qualified accountant will call you about your company, deadlines and fees.
Appointments run monday to friday, 9:00am to 5:30pm. Your confirmation is emailed straight away.
