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How Do Overseas Landlords Apply for Tax Exemptions

How do Overseas Landlords Apply for Tax Exemptions?

Are you a landlord with one or more properties to rent in London and living abroad for a period exceeding six months? Then, for tax purposes, you are classified as a ‘non-resident’ landlord.  This article explains ‘How Do Overseas Landlords Apply for Tax Exemptions”.

The income you receive from renting your home is taxable in the United Kingdom, that is, rent is not exempt from UK Income Tax. You can pick one of two ways to be taxed:

1. Having your tenant or letting agent deduct tax at source

Letting agents and tenants must make an annual return to HM Revenue & Customs (HMRC), declaring respectively how much rent they have paid to or collected for the landlord (you).

Both are required to register with HMRC’s Non-Resident Landlord Scheme within 30 days of starting tenancy.

Agents can file the NRL4i form while tenants can write to the following address:

HM Revenue and Customs
Charities, Savings and International Operations S0708
PO Box 203
L69 9AP

2. Getting your rent in full and filing a self-assessment (SA) tax return

If you want to receive your rent in full without having tenants or agents deduct tax at source, you must complete the Self-Assessment Form. An online filing deadline of 31 January and a postal deadline of 31 October apply.

You will need to fill in the NRLi form, which you can access here. HMRC will consider details such as your duration of stay outside the UK, information on any properties rented out in the country, as well as your personal and contact information.

To reiterate, there is no tax exemption for overseas landlords. You will automatically qualify for self-assessment with HMRC after having lived abroad for six months.

Deducting expenses

As a non-resident landlord, you can offset the tax deducted from your UK rental income against your tax bill at the time of completing your self-assessment tax return. If the agent has deducted more tax than the applicable liability, you can claim the excess in repayment back to you.

Letting agents can deduct expenses when they determine that such amounts are reasonably allowable while computing the non-resident landlord’s rental profits. HMRC gives tenants and letting agents leeway in computations and does not impose a penalty on incorrect deductions.

Allowable expenses include:
– Maintenance and repair costs
– Cost of services such as gardeners and cleaners
– Council tax, water rates, electricity and gas bills, if paid by you
Property management fees

For more information on tax obligations related to rental incomes earned in the UK and capital gains tax on properties for sale in London please give our sales team at Greater London Properties a call and we can provide you with some reliable contacts in the industry.

Greater London Properties are Central London’s largest independent estate agent specialising in residential sales, lettings and Property Management, call us today on 0207 734 4062 or go online to our website 


Hopefully this answers your question “How Do Overseas Landlords Apply for Tax Exemptions”.

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