The decision at a glance
The core trade-off: selling crystallises one tax event while your reliefs are strongest; letting swaps that for income taxed in the UK every year, plus a bigger, less-relieved CGT bill when you eventually sell.
| Decision factor | Sell (before or soon after leaving) | Keep and rent it out |
|---|---|---|
| CGT now | Often nil: full Private Residence Relief plus the final 9 months | None until you eventually sell |
| CGT on a later sale | Not applicable | 18% or 24% on the gain, with PRR eroded by each let year |
| Reporting the sale | 60-day return once non-resident, even if no tax is due | Same 60-day return, usually with a larger taxable gain |
| Ongoing UK filing | None, if you have no other UK income | Self Assessment every year (SA105 plus SA109 residence pages) |
| Tax on rent | Not applicable | 20% withheld under the NRL Scheme unless NRL1 approved |
| Mortgage interest | Not applicable | No deduction: only a 20% basic-rate tax reducer (Section 24) |
| Making Tax Digital | Not applicable | Quarterly updates if gross rent tops £50,000 (£30,000 from April 2027) |
| Cash and flexibility | Capital released, clean break, no UK landlord admin | Keeps a UK base and income, but admin runs from abroad |
The verdict: sell if your gain is large and your reason for keeping the house is weak; let if the yield is strong, the gain is modest or rebased away, or you expect to move back in.
Selling: the CGT side of the move
If the property has been your only or main home throughout, Private Residence Relief (PRR) normally covers the whole gain, and the last 9 months of ownership qualify automatically even after you move out (GOV.UK). Sell within that window, or while UK resident before you fly, and there is often no UK CGT at all.
Timing matters because non-residence changes the occupation test. In any tax year you are non-resident, the property only counts as your residence for PRR if you or your spouse or civil partner spend at least 90 days in it, which most people abroad cannot do. Years that fail attract no relief, so the exempt fraction shrinks the longer you hold on.
Two features soften the blow. First, non-residents are normally taxed only on growth since 5 April 2015: earlier purchases are rebased to market value at that date, with time apportionment or whole-period elections where they give a better result. Second, the 2026/27 rates are 18% on gains within your unused basic rate band and 24% above it (GOV.UK CGT rates), after the £3,000 annual exempt amount per person; a jointly owned home gets two of each. Run your numbers through our CGT property calculator.
The 60-day rule: the deadline sellers abroad miss
Once you are non-resident, you must report any disposal of UK property to HMRC within 60 days of completion, even if no tax is due or you made a loss (GOV.UK guidance). UK residents, by contrast, only file the 60-day return where CGT is actually payable.
Miss the deadline and HMRC charges an automatic £100 penalty, with further penalties at 6 and 12 months plus interest on late-paid tax. A fully relieved sale still needs the return, so build it into the conveyancing timetable. Our non-resident CGT guide walks through the return step by step.
Letting: the landlord side of the move
Keep the house and rent it out, and the profit stays taxable in the UK however long you live abroad. Once your usual place of abode is outside the UK, the Non-Resident Landlord Scheme applies: your letting agent, or a tenant paying more than £100 a week where there is no agent, must deduct 20% tax from the rent unless you apply on form NRL1 and HMRC approves gross payment (GOV.UK). Approval does not exempt the income; it moves collection into your annual return, which is better for cash flow.
You then file Self Assessment every year with the SA109 residence pages, which HMRC's free online service does not support, so you need commercial software or an agent. Most British and EEA nationals keep the £12,570 Personal Allowance abroad, so a modest rental profit can carry little or no UK tax. The bigger structural cost is Section 24: mortgage interest is not deductible from rental profit; you instead get a tax reduction worth 20% of the finance costs (GOV.UK). A higher-rate landlord with a large mortgage can owe tax on a property that barely breaks even in cash.
Your new country will usually tax the same rent too, with credit for UK tax under the relevant treaty; Horizon advises on the UK side and coordinates with a local adviser in your destination country for the local filings. Estimate the UK side with our rental income calculator.
Making Tax Digital: the new admin layer from April 2026
Making Tax Digital for Income Tax applies to non-resident landlords just as it does to residents. It went live on 6 April 2026 for anyone whose gross qualifying income (rents plus any self-employment turnover, before expenses) was over £50,000 in 2024/25, with £30,000 following from 6 April 2027 and £20,000 from 6 April 2028 (GOV.UK). Once in, the annual return becomes digital records, four quarterly updates and a year-end return through software.
There is a deferral for the internationally mobile: anyone who included the SA109 residence pages in their 2024/25 return is automatically exempt until April 2027, and new leavers who reasonably expect to file the SA109 for 2025/26 or 2026/27 can apply to HMRC for the same deferral (GOV.UK exemptions). It is a postponement, not an escape. Check your start date with our MTD checker and see our MTD for non-resident landlords guide.
The hidden cost of waiting: how letting erodes your relief
The tax case for selling decays over time. PRR is apportioned by period: your exempt fraction is broadly your qualifying years of occupation, plus the final 9 months, over your total ownership. Each full tax year abroad that fails the 90-day test adds to the denominator without adding to the numerator, so a house that could have been sold tax-free in year one might carry a substantial taxable gain by year six.
Rebasing to 5 April 2015 protects long-held property from tax on decades of pre-departure growth, but does nothing for growth after you leave. When the sale finally happens, the 60-day return, possible foreign tax and the loss of your own use all land at once. If your plan is "rent it for two or three years then sell", model the eroded relief now.
One more planning point: if you return to the UK within five years, other assets can be caught by the temporary non-residence rules, but UK residential property gains are taxed in the year of disposal anyway, so there is rarely a benefit in delaying a sale until you return. See our guide to returning to the UK.
Which route fits your scenario?
Most moves fall into a recognisable pattern:
- Large gain, no plan to return: sell before you leave or within the final 9 months, while full PRR is at its peak.
- Permanent move, strong yield, small mortgage: letting can work, especially if profits sit under the £12,570 Personal Allowance and rent stays below the MTD thresholds.
- Highly geared property: Section 24 makes letting expensive for higher-rate taxpayers; negative cash flow with a tax bill on top is common, so selling usually wins.
- Likely return within a few years: keeping the home preserves your base, and moving back in restores occupation for future PRR periods, though eroded years are not restored.
- Bought before April 2015: rebasing means only post-2015 growth is taxed, so the CGT may be smaller than you fear; get a 5 April 2015 valuation.
- Undecided: a short let keeps options open, but diarise when PRR erosion starts to bite and revisit each year.
Sequence the property decision with the rest of your departure: split-year treatment, your P85 or final return, and your position under the Statutory Residence Test all interact with it.
Getting the decision right before you fly
This decision is worth making with real numbers: a PRR calculation on a sale today against projected rental profits, Section 24, MTD admin and the eroded relief on a sale in five years. Horizon UK Tax Solutions is a Chartered Tax Adviser practice that runs exactly this comparison for people leaving the UK, on a fixed fee agreed upfront; our non-resident and expat returns start from £550 a year if you keep the property.
