The rules for non resident landlords can be quite complex.  It's important that overseas landlords understand exactly what they should be reporting to HMRC in order to avoid penalties and fines.

What is the Non Resident Landlords Scheme?

This scheme deals with how letting agents and tenants, in the UK, pay tax on behalf of Landlords abroad.

Any landlord who lives abroad for more than six months of the year must pay tax on income they receive from the renting out of property in the UK.  

If the Landlord is a company or a trustee, the rules about their usual place of abode will apply.

This tax is collected via the Non Resident Landlord Scheme.  The tax can be paid either by the letting agent or the tenant. 

If the landlord is a joint owner the tax is paid on their share of the rental income.

How do my tenants deal with this?

If you live abroad and your tenants are paying you more than £100 per week, they need to register with HMRC and deduct tax from their rent.

If they pay their rent to a UK representative, and not a letting agent eg. a family friend, they will still need to register with HMRC.

Your tenants do not need to deduct the tax if HMRC has told them in writing that you can receive the rent with no tax deducted.  However, they must still register with HMRC and complete and annual report.