FAQ 025 | What Is the Non-Resident Landlord Scheme (NRL), and Does Approval Mean You No Longer Need to File?

Author: SJW Research & Intelligence

Brand: SJW UK Properties

What is the Non-Resident Landlord Scheme (NRL)?

If you live outside the UK and own a UK property that is let, you are very likely to come across the Non-Resident Landlord Scheme, usually shortened to NRL. Hearing the name for the first time, many overseas landlords assume: “I have applied for the NRL, so presumably I no longer need to file a tax return.” That is not the case.

What is the NRL?

The NRL is a tax administration scheme operated by HM Revenue & Customs (HMRC) for landlords living outside the UK. It governs how UK rental income is dealt with for tax purposes when it is paid to an overseas landlord. It is not a tax, it is not a tax relief, and it is not an exemption.

Why do you need to apply for the NRL?

If an overseas landlord has not applied for, and been approved by, HMRC to receive rent in full, then the party paying the rent, such as the managing agent or the tenant, may be required to deduct tax from it and account for that tax to HMRC. Where HMRC approves the landlord’s application, the rent can generally be paid to the landlord in the manner HMRC has approved. That does not, however, mean the landlord’s tax obligations have come to an end.

Does NRL approval mean you no longer need to file?

This is one of the questions we have been asked most often since 2015. The answer is no. Many clients read NRL approval, which is approval to receive rent, as tax clearance, meaning that the tax has been dealt with. These are two entirely different things. The NRL is concerned with how rent is paid, whereas the annual tax return still has to be made in accordance with UK tax law and the landlord’s own circumstances. Holding NRL approval therefore does not mean that Self Assessment, or any other filing that may apply, is no longer required.

Why did HMRC create the NRL?

The purpose of the scheme is not to add to the burden on overseas investors, but to ensure that rental income from UK property is dealt with under the UK tax system even where the landlord lives abroad long term. The NRL is closer to an administrative arrangement than a tax. In business since 2015: many clients confuse the NRL with filing a return

Since 2015 we have found that many clients, on receiving their NRL paperwork from HMRC, conclude that their tax affairs are fully in order. In fact, that is only one step. Holding a UK let property over the long term also involves collating the rental income each year, keeping records of the associated costs, working with an accountant to complete the annual return, and keeping up with changes in tax policy. All of these form part of holding a UK let property for the long term.

SJW Practical Tip

Based on our experience at SJW UK Properties since 2015, we recommend that overseas landlords keep every piece of correspondence they receive from HMRC, including the NRL approval letter, their HMRC tax reference, Self Assessment documents, annual tax return papers and any other HMRC correspondence. All of these may be needed in future. If you change managing agent, we also suggest passing the relevant documents to the new agent promptly, so that the rent payment arrangements are not disrupted.

SJW Insight

Since 2015 we have become increasingly convinced that the UK tax system is not something a single application brings to a close. Experienced overseas landlords treat tax as part of long-term asset management. The NRL, the annual return, rental income and tax planning together form the basis on which a UK let property is run compliantly over the long term. At SJW UK Properties we therefore always encourage clients to see the NRL not as an approval letter, but as the starting point of long-term tax management.

Official References (as at July 2026)

This article is compiled from UK government sources:

 HM Revenue & Customs (HMRC) — Non-Resident Landlords Scheme

 GOV.UK — Guidance for overseas landlords receiving UK rental income

Last updated: July 2026

Disclaimer: This article is provided for general information only and does not constitute legal, tax or accounting advice. UK tax policy may change and circumstances differ from landlord to landlord. Please refer to the current HMRC rules and consult a professional tax adviser or accountant.