Non-resident landlords ― choice of acquisition vehicle

Produced by Tolley in association with of Crane Dale Tax, part of AMS Group

Corporation Tax

Guidance

Non-resident investors that rent UK residential and commercial real estate are subject to tax on the rental income derived from the properties. The non-resident will also be subject to tax on any gain arising on the eventual disposal of the UK property. The tax consequences vary depending on the choice of vehicle used to acquire the property.

This note considers the UK tax implications where the UK property is acquired by a non-resident that is:

•
a company
•
an individual

Regardless of the choice of acquisition vehicle, the UK operates a withholding tax regime for rents payable to non-UK resident landlords known as the non-resident landlords scheme (NRLS). For more information on the scheme, see the Non-resident landlords scheme (NRLS) guidance note.

The taxation of capital gains realised by non-resident investors on UK land or property has changed significantly from 6 April 2019. From that date, all disposals of UK property by non-residents were brought within the scope of UK tax (commercial

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Rob Durrant-Walker

Tax Director at Crane Dale Tax , Corporate Tax, OMB, Personal Tax

Rob is a cross-tax advisor with a particular focus on property tax planning, and business structure planning for OMB’s. He provides tax advice to other accounting firms, balancing commerciality, ethics, and understanding complexity. His 30+ years of experience start at the Inland Revenue in Hull. After completing his ATT and CTA by 1999 with PKF, he subsequently worked at KPMG and UHY prior to managing the business tax team as a director at Garbutt + Elliott. Rob is now Tax Director at the independent tax consultancy, Crane Dale Tax. He is a regular author for Taxation magazine with many articles and Readers Forum contributions since 2005, and he contributes as a virtual member to the CIOT Property Tax technical committee. Rob works remotely from Vancouver in Canada.

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