HMRC Sends ‘Nudge’ Letters to Overseas Landlords of UK Property & Tenants


The HMRC are following up on their success in obtaining and using information from overseas tax authorities by sending out nudge letters to overseas corporate/trust owners who let UK residential property, and their tenants.

HMRC has sent out two standard formatted letters; one to overseas corporate/trust owners and one to the tenants of UK residential property owned by overseas corporate/trust owners.

The letters remind tenants and owners of Annual Tax Enveloped Dwellings (ATED) and the non-resident landlord (NRL) scheme.

Letters to Overseas Corporate/Trust Owners

The letters to overseas corporate/trust owners ask for information on the overseas ownership structure of property if it is held in a trust. The letters also remind the overseas owner of Annual Tax on Enveloped Dwellings (ATED) and the non-resident landlord (NRL) scheme.

Letters to Tenants

The letters sent to tenants remind them that if the registration of the NRL has not happened, 20% of income tax will be deducted from the rent and paid to the HMRC – all of which is to be arranged by the tenant. The letter also explains how to register for NRL.

The HMRC letter to the UK tenants will also enclose a form which asks for further information such as the date the tenant first occupied the UK property and the rent being paid.

What to Do if You Receive an HMRC Nudge Letter

If you receive any of the HMRC ‘nudge’ letters do not ignore the letter! You should provide to HMRC the information they require. Perhaps the NRL registrations will already be in place, or no rent is being paid, in which case that is the answer(s) to be given to HMRC.

If the letters are ignored, the HMRC will follow up with more formal enquiries.

It is strongly recommended that if you receive one of the above-mentioned HMRC letters, professional advice should be taken before replying to HMRC.

At HaesCooper Accountants, we have the necessary expertise to deal with the HMRC on these matters. If you, as the overseas landlord or the UK tenant, receive any of the above-mentioned letters don’t hesitate to contact us.

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