Non-resident landlord CGT applies when a landlord who lives outside the UK sells a UK rental property. You pay Capital Gains Tax at 18% or 24% on the gain, usually only on the increase in value since 5 April 2015, and you must report the sale to HMRC within 60 days of completion even if no tax is due. You also need to close down your UK rental income position, including any tax deducted under the Non-resident Landlord Scheme.
Most non-resident landlords have two sets of UK obligations when they sell: the 60-day CGT return and their final Self Assessment for the rental income. GOV.UK’s guidance on tax on rental income if you live abroad covers the income side.
This guide explains how non-resident landlord CGT works, the reliefs that still apply, a full worked example for 2026/27, and a checklist for the year you sell.
How Non-Resident Landlord CGT Works
As a non-resident, you have paid UK CGT on residential property since 6 April 2015. For a buy-to-let owned before that date, the gain is normally rebased to the market value at 5 April 2015, so the growth before then is not taxed. You can instead choose time apportionment or the whole-period gain if that gives a better result.
The gain is taxed at 18% within your unused basic rate band and 24% above it. Only your UK taxable income, such as your rental profit, uses up the basic rate band. Our guide to a non-resident selling UK property explains the three calculation methods in more detail, and HMRC’s guide to working out your tax as a non-resident sets out the official rules.
Reliefs and Costs Non-Resident Landlords Can Claim
- Annual exempt amount: the first £3,000 of gains in 2026/27 is tax-free. See our guide to the CGT annual exempt amount.
- Buying and selling costs: legal fees, estate agent fees and Stamp Duty Land Tax on purchase (if you use the original cost).
- Improvement costs: extensions, loft conversions and other capital works. Repairs and redecoration claimed against rent are not allowed twice.
- Private Residence Relief: only for periods the property was your home and, after April 2015, only for tax years in which you met the 90-day test. Read what Private Residence Relief is.
- Letting relief: since April 2020 this only applies if you lived in the property at the same time as your tenant.
- Capital losses: UK property losses reported on time can be set against the gain.
Mortgage interest and the outstanding loan do not reduce the gain. CGT is charged on the gain, not on the cash you receive.
Worked Example: Non-Resident Landlord Selling a Buy-to-Let
Marcus lives in Spain. He bought a Bristol flat in 2012 for £180,000 and has let it out ever since. Its market value at 5 April 2015 was £240,000. He spent £10,000 on a new kitchen extension in 2019 and sells in August 2026 for £330,000, with £6,000 of selling costs. His UK rental profit is within his personal allowance, so his full basic rate band is available.
| Step | Amount |
|---|---|
| Sale price | £330,000 |
| Less selling costs | (£6,000) |
| Less 5 April 2015 market value | (£240,000) |
| Less improvement costs | (£10,000) |
| Gain | £74,000 |
| Less annual exempt amount | (£3,000) |
| Taxable gain | £71,000 |
| £37,700 at 18% | £6,786 |
| £33,300 at 24% | £7,992 |
| Total non-resident landlord CGT | £14,778 |
Marcus must file his return and pay the £14,778 within 60 days of completion. Spain may also tax the gain, but he can usually claim credit for the UK tax under the UK-Spain double tax agreement. Try our non-resident CGT calculator for your own figures.
The Non-Resident Landlord Scheme in the Year You Sell
Under the Non-resident Landlord Scheme, your letting agent or tenant deducts basic rate tax from the rent unless HMRC has approved you to receive rent without deduction. When you sell:
- tell your agent the tenancy is ending so they stop deducting and send you your annual NRL6 certificate,
- include the final period of rent on your Self Assessment return for that tax year, and
- claim any tax already deducted as a credit against your income tax bill.
HMRC’s guidance on paying tax on rent to landlords abroad explains how the scheme works for agents and tenants.
Reporting Deadlines for Non-Resident Landlords
| Obligation | Deadline |
|---|---|
| Non-resident CGT return and payment | 60 days after completion |
| Self Assessment return (rental income and the gain) | 31 January after the end of the tax year |
| Any balance of income tax | 31 January after the end of the tax year |
The 60-day deadline applies even if the gain is covered by reliefs. Our guides to the non-resident CGT 60 day rule and how to file a non-resident CGT return walk you through it.
Common Mistakes Non-Resident Landlords Make
- Assuming no return is needed. Every UK property sale by a non-resident must be reported.
- Deducting repairs twice. Costs already claimed against rent cannot also reduce the gain.
- Forgetting the 2015 valuation. Without it, you may be taxed on the full gain.
- Ignoring UK rental profit. It reduces how much of the gain is taxed at 18%.
- Not claiming the NRL tax back. Tax deducted from rent is credited on your Self Assessment.
Frequently Asked Questions
Do non-residents pay Capital Gains Tax on UK property?
Yes. Non-residents pay UK CGT on UK residential property gains since April 2015 and on other UK land and property since April 2019, at 18% or 24%.
Do non-residents get the CGT annual exemption?
Yes. Non-resident individuals get the same £3,000 annual exempt amount as UK residents for 2026/27.
What happens if I sell my home in the UK while non-resident?
You must report the sale within 60 days of completion. If it was once your main home, Private Residence Relief may cover part of the gain, but only for years you met the 90-day test after April 2015.
Do I pay Capital Gains Tax if I sell my rented property?
Yes, if there is a gain above the annual exempt amount. Rental property does not qualify for Private Residence Relief for the periods it was let, unless you also lived there.
Can I offset my mortgage against the gain?
No. The mortgage balance does not reduce the taxable gain, even though it reduces the cash you receive.
Get expert help: If you are searching for a capital gains tax accountant near me, our team works with clients across the UK by phone and video. Our non-resident CGT service and wider capital gains tax services are designed for situations like this one.
Conclusion
Non-resident landlord CGT is usually charged only on the gain since April 2015, at 18% or 24%, after the £3,000 annual exempt amount and allowable costs. The key is to file the 60-day return on time, use the calculation method that gives the lowest gain, and close down your rental income on Self Assessment, including any Non-resident Landlord Scheme tax.
Plan the sale with your valuation and cost records ready, and check how your country of residence will tax the same gain.
For help selling a UK rental property from abroad, speak to our non-resident CGT specialists or our property CGT team. Call us on +44 (0)1204 859315 or send us your question for a free initial consultation and a fixed-fee quote within 24 hours.
