UK Property Owners Abroad: Tax Rules for Non-Resident Landlords

Owning UK property while living in the UAE is common — but the tax rules for non-resident landlords are often misunderstood.

This guide covers everything from the NRL1 scheme to Capital Gains Tax and allowable expenses.

1. The NRL1 Scheme (Non-Resident Landlord Scheme)

If you move to the UAE and rent out UK property, your agent must deduct 20% tax unless you register for NRL1.

NRL1 allows:

✔ rent paid to you gross

✔ you declare actual profit through Self Assessment

✔ no automatic deductions

2. Allowable Expenses (Fully Deductible)

– letting agent fees– repairs– mortgage interest (restricted relief)– service charges– maintenance– insurance– accountant fees– ground rent– cleaning between tenants

3. Capital Gains Tax (CGT) Still Applies

Even as a non-resident:– you pay CGT on gains from UK property– reporting must be within 60 days– penalties apply if late

4. Self Assessment Is Still Required

Every year you will need to declare:– rental profit– allowable expenses– mortgage interest– capital allowances (if applicable)

5. What If You Sell Your UK Property While in Dubai?

You still pay CGT, but:– your private residence relief may apply– non-resident CGT rules may give partial relief– valuations on the date you became non-resident may help reduce liability

6. Maintaining Your UK Property Business as a UAE Resident

We recommend:

✔ proper bookkeeping

✔ UK accountant familiar with expat tax

✔ TRC (for treaty benefits if income routed abroad)

✔ annual SRT and day count checks

Yahesa provides full non-resident landlord accounting, tax planning, and HMRC filing support — plus NRL1 applications and annual Self Assessment packages.