Non-resident landlords scheme (NRLS) meaning

HMRC’s Non‑resident Landlords Scheme (NRLS) is the UK withholding regime used in property practice to collect tax on rent paid to landlords who are not UK‑resident for tax. Letting agents—and, where no agent acts, tenants paying more than £100 per week—must deduct income tax at the basic rate from rents arising from a UK property business and account for it to HMRC, unless HMRC has authorised payment of rent gross. The deduction gives the landlord a credit against their UK tax liability (income tax for individuals and trustees, or corporation tax for non‑resident companies). The scheme is provided for in legislation, principally the Income Tax (Non‑resident Landlords) Regulations 1995, and is administered consistently across England & Wales, Scotland and Northern Ireland. It applies to individuals, companies and trustees and carries registration, withholding, payment and reporting obligations for letting agents and certain tenants. In Ireland, a separate statutory regime—Non‑Resident Landlord Withholding Tax—applies and the NRLS terminology is not used. Practically significant for: drafting and negotiating rent payment clauses, advising letting agents and tenants on compliance, and tax due diligence where landlords are non‑resident. Search terms: non‑resident landlord tax, HMRC NRLS, withholding on UK rent, pay rent gross approval.