Non-Resident Landlords

What is the Non-Resident Landlord Scheme?

Answered by Jordan Onraet-Wells, Founder & Chartered Tax Adviser (CTA). Published 28 July 2026. Last reviewed 28 July 2026.

The short answer

The Non-Resident Landlord Scheme (NRLS) is HMRC's mechanism for collecting tax on the UK rental income of landlords whose usual place of abode is outside the UK. By default, your letting agent, or your tenant where there is no agent and rent is over £100 a week, must deduct basic-rate tax at 20% from your rent and pay it to HMRC. You can apply on form NRL1 to receive the rent in full instead, but approval is not an exemption: the income is still reported and taxed through Self Assessment.

Letting agents must operate the scheme whatever the level of rent; a tenant paying you directly only operates it where the rent averages more than £100 a week.
Deducted tax is paid to HMRC within 30 days of the end of each tax quarter: 30 June, 30 September, 31 December and 31 March.
HMRC normally treats six months or more abroad as putting your usual place of abode outside the UK, so the scheme can apply even while you are still UK tax resident.
Form NRL1 (the online NRL1i service) is the individual's application to receive rent with no tax deducted; NRL2 covers company landlords and NRL3 trustees.
Your agent or tenant must give you an NRL6 certificate by 5 July each year, showing tax deducted to set against your Self Assessment bill.
Most British and EEA nationals keep the full £12,570 Personal Allowance while abroad, so the flat 20% deduction often takes more than you actually owe.

How the scheme works

UK rental income stays taxable in the UK however far away you live; the NRLS is the collection mechanism, not an extra tax. Because HMRC cannot easily chase a landlord who has left the country, the law makes the person paying the rent responsible: the agent or tenant withholds 20% from the rent after allowable expenses they are aware of, accounts for it quarterly, and certifies the total each year on form NRL6. The scheme covers individuals, companies and trustees, triggered by the usual place of abode test rather than the Statutory Residence Test. Our non-resident landlord tax guide covers the forms and deductions.

Receiving rent gross with form NRL1

To stop the deduction, you apply to HMRC on form NRL1 (NRL1i online). HMRC approves where your UK tax affairs are up to date, normally from the start of the quarter HMRC receives it; a late or missing return is a common cause of refusal, and you can appeal in writing. Approval usually improves cash flow, because a flat 20% often over-collects once expenses, the basic-rate finance cost reduction and the Personal Allowance are taken into account. It does not make the rent tax free: you must still declare every penny, and HMRC can withdraw approval if you fall behind.

Filing and reclaiming the tax deducted

You report the income on the SA105 property pages with the SA109 residence pages alongside; any NRLS tax already deducted is credited against your final bill, which is how you reclaim an over-collection. HMRC's free online service does not support the SA109, so non-residents file on paper, through commercial software or via an agent; where a refund is due and no return is needed, form R43 is the alternative route. Our expat Self Assessment guide covers the filing options and deadlines.

Go deeper

Sources and further reading

This is general information for the 2026/27 UK tax year, not personal tax advice; speak to a Chartered Tax Adviser about your own position.

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