You need to pay tax on your rental income if you rent out a property in the UK.
You may also need to pay tax if you make a gain when you sell residential property in the UK.
If you live abroad for 6 months or more per year, you’re classed as a ‘non-resident landlord’ by HM Revenue and Customs (HMRC) – even if you’re a UK resident for tax purposes.
How you pay tax
You can get your rent either:
- in full and pay tax through Self Assessment – if HMRC allows you to do this
- with tax already deducted by your letting agent or tenant
Get your rent in full
If you want to pay tax on your rental income through Self Assessment, fill inform NRL1i and send it back to HMRC.
If your application is approved, HMRC will tell your letting agent or tenant not to deduct tax from your rent and you’ll need to declare your income in your Self Assessment tax return.
HMRC will not approve your application if your taxes aren’t up to date, eg you’re late with your tax returns or payments.
Get your rent with tax deducted
Your letting agent or tenant will:
- deduct basic rate tax from your rent (after allowing for any expensesthey’ve paid)
- give you a certificate at the end of the tax year saying how much tax they’ve deducted
If you don’t have a letting agent and your tenant pays you more than £100 a week in rent, they’ll deduct the tax from their rent payments to you.
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