What is non-resident landlord scheme?
Answered 11 March 2026
The Non-Resident Landlord (NRL) Scheme
HMRC Guidance / Practice
What it is
The Non-Resident Landlord (NRL) Scheme is a mechanism for collecting UK income tax at source from the UK rental income of landlords whose usual place of abode is outside the UK. UK rental income remains chargeable to Income Tax (or Corporation Tax) even where the landlord is non-resident — no Double Taxation Convention transfers this right to any foreign authority.
Who is a "non-resident landlord"?
A non-resident landlord is any person — including individuals, companies, and trustees — who has UK rental income and a usual place of abode outside the UK. It is the usual place of abode (not formal tax residence) that determines whether a landlord falls within the Scheme.
How tax is collected — the "prescribed persons"
Tax is collected by the landlord's UK representative (called a "prescribed person" in the regulations), which is either:
- A letting agent who handles or controls UK letting income on behalf of the non-resident landlord; or
- A tenant who makes payments directly to the non-resident landlord.
Where a letting agent is involved, it is the agent (not the tenant) who must operate the Scheme.
Who counts as a "letting agent"?
A letting agent is a UK-based person who acts for the non-resident landlord in running their UK property business and has the power to receive or direct the landlord's rental income. This can include accountants, solicitors, friends, or relatives — not just professional estate agents.
When tenants must operate the Scheme
Tenants must operate the Scheme only if:
- The rent exceeds £100 per week, and
- They pay it directly to the non-resident landlord (i.e., there is no letting agent).
HMRC may also instruct tenants to operate the Scheme even where rent is below £100/week if the landlord's total rental income from multiple tenants exceeds that threshold.
How tax is deducted
Where no application for gross payment has been approved, the letting agent or tenant must deduct basic rate tax from the net rent after any allowable expenses. Allowable deductions before calculating tax include letting agent fees, advertising costs, gardening, etc..
Receiving rent gross (no deduction)
Non-resident landlords whose UK tax affairs are up to date may apply to HMRC's PT International (Liverpool) to receive rental income with no tax deducted. If no application is made, or it is refused, the withholding obligation applies.
Obligations of letting agents
Letting agents operating the Scheme must:
- Register with HMRC
- Account quarterly for tax to HMRC
- Complete an annual information return
- Provide the non-resident landlord with a certificate of tax liability each year
- Keep sufficient records of compliance
They have the right to deduct any tax paid under the Scheme from rent or other money owed to the landlord.
Obligations of tenants
Tenants operating the Scheme must:
- Notify HMRC
- Account quarterly for tax to HMRC
- Provide the landlord with a certificate of tax liability each year
- Complete an annual information return (if applicable)
- Keep sufficient records of compliance
Citation sources
If a tenant pays rent to a non-resident landlord via a UK letting agent, it is the letting agent and not the tenant who must operate the Non-resident Landlords Scheme. Tenants of non-resident landlords only operate the Scheme if the rent they pay is over £100 a week and they pay it direct to a non-resident landlord or someone who is not acting as a letting agent (see PIM4820). However, HMRC may instruct tenants to operate the Scheme even where the rent paid is less than £100 a week. This may hap
Tenants who are required to operate the Non-resident Landlords Scheme must: notify HMRC account quarterly to HMRC for any tax due under the Scheme (where they are required to account for tax) provide their non-resident landlords with a certificate of tax liability each year complete an annual information return, if appropriate, and keep sufficient records to show that they have complied with the requirements of the Scheme. Tenants have the right to deduct any tax they have to pay under the Schem
For the purposes of the Scheme, a non-resident landlord is a person (including individuals, companies and trustees) who has UK rental income, and a ‘usual place of abode’ outside the UK. Although the scheme refers to ‘non-resident’ landlords, it is usual place of abode that determines whether a landlord is within the Scheme. PIM4850 gives more information about usual place of abode.
The NRL’s representative could be: A letting agent who handles or controls UK letting income on behalf of a landlord whose usual place of abode is outside the UK; or A tenant who makes payments directly to a landlord whose usual place of abode is outside the UK. For the purposes of the scheme, ‘letting agents’ are persons who act in the management or administration of a non-resident landlord's property business. This may include friends and relatives of a non-resident landlord as well as profess
A letting agent is generally a person who: has a 'usual place of abode' in the UK, and acts for a non-resident landlord (NRL) in the running of their UK property business, and has the power to receive income of the non-resident landlord's property business, or has control over the direction of that income. A ‘letting agent’ for the purposes of the scheme does not need to be an estate agent or other property management business. A ‘letting agent’ could be a professional representative like an acc
If property is located in the United Kingdom (UK) then any income generated from it is charged to tax in the UK. This applies even if the property owner is not a UK resident or, for the purposes of the Non-Resident Landlord (NRL) Scheme, has a usual place of abode outside the UK. Income or Corporation Tax remains chargeable on UK rental income even where the landlord is non-resident for other UK Tax purposes. No Double Taxation Conventions transfer this right to any foreign authority. If the ren
Non-resident landlords, whose UK tax affairs are up to date can apply to PT International, Liverpool to receive UK rental income with no tax deducted. Where no application is made, or an application is refused, the letting agent (or tenant where there is no letting agent) must deduct basic rate tax from the net rent after any allowable expenses incurred by the agent / tenant. An individual not resident in the United Kingdom can still be liable to tax on income arising in the UK. This is a matter
Letting agents who have to operate the Non-resident Landlords Scheme must: register with HMRC account quarterly for any tax to HMRC complete an annual information return, where they are required to account for tax, provide their non-resident landlords with a certificate of tax liability each year, and keep sufficient records to show that they have complied with the requirements of the Scheme. Letting agents have the right to deduct any tax they have to pay under the Scheme from their rent, or fr