How to manage your property from abroad
Being a residential landlord doesn’t mean you can’t live abroad. Our guide tells you all you need to know if you’re managing your property from abroad.
You may have plans to retire in Mallorca or maybe you’re transferring to the US for work. What do you do about your rental properties?
Let’s look at some points specifically about income from buy-to-let. Holiday lets have slightly different tax considerations, so please ask your tax advisor if you have a holiday let.
Check your tax status
HMRC is your main concern in this situation. Your rental income (minus allowable expenses) gets taxed, and that doesn’t change just because you move abroad.
There are special cases:
- Where deductions make your income from rental properties very low (under £2,500 per year)
- Where you’re eligible to receive rental income without tax deductions (check the relevant HMRC pages and ask your tax advisor)
When you move abroad, you’ll pay tax on rental income under the Non-resident Landlord Scheme (NRLS). Tax is deducted at source. So either:
- Your managing agent takes off tax at the basic rate OR
- Your tenants (if you don’t use a managing agent) take off tax at the basic rate
Look into agents
You may have been happy (or at least able) to manage your rental property yourself while you lived in the UK. But dealing with broken windows, non-payment of Council Tax, and void periods from abroad is altogether different.
What’s more, your tenants must have a UK address and contact details for the landlord or – you guessed it – a managing/lettings agent.
If cost is a worry and you don’t mind handling those day-to-day tenant issues, then ask if the agent can just deal with finding and vetting tenants, end of tenancy, and tax.
Check your landlord insurance
- What’s the maximum number of days the property can be empty and still covered?
- Have you got the right level of contents cover?
- Do you need to add cover for loss of rent?
- Is there a helpline you can call from abroad?
- Are your boiler, gas, and electrics checks up to date?
Contact your insurer
If you’re definitely moving abroad, let your insurer know. They’ll need information such as:
- what policies you hold and the policy numbers
- your new address
- your new contact details (phones, emails)
- whether or not you’re using a managing agent for your rental properties
- how much time (if any) you still spend in the UK and
- do you still have a UK address?
A move abroad doesn’t have to mean loss of rental income. But it does require extra organization.
Make sure you understand your tax requirements to avoid a hefty fine. And keep your landlord insurance up to date for solid cover.