Landlords may need to pay Capital Gains Tax on any gain when they sell a property which has been let. In addition, Landlords are liable to income tax on the rental income. The amount payable is dependent on their circumstances.

The rules as to which expenses can be offset against tax change from time to time (for example, changes to remove the allowance for wear and tear and the phasing out of tax relief on mortgage interest). Landlords are advised to contact their accountant or HM Revenue and Customs (HMRC) to obtain confirmation regarding available allowances.

Overseas Landlords :

  • Landlords who live abroad for 6 months or more per year are classed as ‘non-resident landlords’ by HMRC even if they are a UK resident for tax purposes. Specific rules apply to overseas landlords including companies that have their offices or other place of business outside the UK, companies incorporated outside the UK; trustees; members of the HM Forces and HM Government employees.
  • Landlords can apply to the HMRC to pay their tax through Self-Assessment and if approved, HMRC will notify the letting agent that they can cease to withhold tax (up to receipt of the exemption certificate, they must retain the tax). 
  • Landlords are recommended to contact their HM Revenue & Customs office or their accountant if they have any queries as soon as possible and preferably prior to any tenancy commencing.
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