NRL1 Form: How to Apply for Gross Approval to Receive UK Rent Without Tax Deducted

If you live abroad and let out property in the UK, your letting agent or tenant is generally required to deduct basic-rate tax (20%) from your rent before they pay you. Gross-payment approval, applied for using HMRC's NRL1 form, removes that deduction: you receive the full rent and account for the tax yourself through Self Assessment. This guide is the specialist walkthrough of that application, from the eligibility gate to completing and posting the form, the timescales, the approval reference number, where the tax deducted goes on your return, and how to recover tax already withheld.

For a broader overview of who counts as a non-resident landlord and how the scheme works end to end, see our complete guide to the Non-resident Landlords Scheme. This page goes deeper specifically on the gross-approval application itself.

What gross-payment approval is, and the statutory basis

The Non-resident Landlords Scheme is a statutory withholding mechanism, not a treaty arrangement. The power for it sits in section 971 of the Income Tax Act 2007 ("Income tax due in respect of income of non-resident landlords") and section 972, under which the detailed rules run through the Taxation of Income from Land (Non-residents) Regulations 1995 (SI 1995/2902). Because it is statutory, treaty residence does not switch it off. Even where a double tax treaty resolves your residence to another country, a UK agent or tenant must still operate the scheme on your rent unless you hold approval to be paid gross.

Without approval, the agent or tenant deducts basic-rate tax from your rent (after allowing for certain expenses they have paid on your behalf) and accounts for it to HMRC. That is the 20% withholding our guide to the 20% NRL deduction explains in detail. With NRL1 approval, that deduction stops: you receive the rent in full and settle your actual liability through Self Assessment, which is usually a better outcome once your mortgage interest, letting costs and other allowable expenses are taken into account.

Are you eligible? The usual place of abode test

The gate for the scheme is not your formal tax residence but your usual place of abode. You are a non-resident landlord for scheme purposes if your usual place of abode is outside the UK, and HMRC's working practice treats living abroad for six months or more in a year as the practical trigger. This is deliberately broader than the Statutory Residence Test: you can fail the residence test (and so be UK resident in the round) yet still have a usual place of abode abroad for a period, for example on a long secondment.

Being within the scheme is one thing; being approved to receive rent gross is another. HMRC grants gross-payment approval where your UK tax affairs are up to date and you expect to keep them up to date. In practice that means your Self Assessment returns are filed, any tax due is paid, and there is no open enquiry or unpaid penalty hanging over you. There is no rule requiring a clean record for a set number of years: earlier versions of guidance circulating online cite a "two-year" qualifying period, but that figure is not in the legislation or in HMRC's published guidance. The real test is simply whether your affairs are in order now and you commit to staying compliant.

NRL1, NRL2, NRL3 and the rest of the form family

People often confuse the gross-payment application with the agent's returns. They are different forms with different jobs. The application is made by the landlord, by type of landlord; the returns are made by the agent or tenant who operates the scheme. Search results muddy this further because "NRL" is also a rugby league competition, so the HMRC form is sometimes typed as the "non-resident landlord election form" or "NRL landlord form". On HMRC's own register the document you want is the NRL1. The table below sets out the family.

Form	Who uses it	Purpose
NRL1 (NRL1i)	Individual landlord	Application to receive UK rent gross (no tax deducted at source)
NRL2	Company landlord	Same gross-payment application, for a non-resident company
NRL3	Trustee landlord	Same gross-payment application, for trustees
NRL4	UK letting agent	Agent's registration with HMRC to operate the scheme
NRLQ	Agent or tenant	Quarterly return of rent paid and tax withheld
NRLY	Agent or tenant	Annual information return
NRL6	Agent or tenant (to landlord)	Year-end certificate showing the tax deducted

So if you are an individual letting UK property from abroad, your form is the NRL1. The agent-side mechanics, the quarterly NRLQ return and the year-end NRL6 certificate, are covered in our guide to the agent's NRL returns. Non-resident companies, including landlords now within UK corporation tax on rental profits, should read our note on how the scheme applies to non-resident companies.

How to complete the NRL1 form, step by step

Before you start, gather the information HMRC asks for. Having it to hand avoids the most common cause of delay, mismatched details. You will typically need:

• Your full name and your current address outside the UK
• Your National Insurance number, if you have ever had one
• Your Unique Taxpayer Reference (UTR), if you are already registered for Self Assessment
• The full UK address of every property you let, including any not currently tenanted
• The name and address of each letting agent who manages a property for you (or confirmation that you let directly)
• The date you went, or expect to go, abroad

The form walks through your personal details, the properties concerned, your letting arrangements and your tax history. Make sure the name, address and references you give match HMRC's records exactly, because a mismatch is the single most frequent reason applications stall. If you already file a return, quoting your UTR lets HMRC tie the NRL1 straight to your record.

Can you do the NRL1 form online, or do you post it?

You can apply two ways. You can use HMRC's online NRL1 service through a Government Gateway account, or you can download, print and post the paper NRL1 form. There is one important caveat the online route does not make obvious: if you want a tax agent or accountant to act for you, you generally cannot use the online service. HMRC's guidance is to complete the paper NRL1 form instead and send it in together with a completed agent authorisation form (64-8). If you intend to have an accountant handle your UK property tax, choose the paper route from the start so you do not have to redo the authorisation later.

Where to send the paper NRL1 form

The paper NRL1 goes to HMRC's non-resident landlords handling team:

• Charities, Savings and International 1
• HM Revenue and Customs
• BX9 1AU
• United Kingdom

BX9 1AU is HMRC's central postal address and does not need a street name. Where you are using an accountant, put the signed 64-8 in the same envelope as the NRL1. Keep proof of posting: it is your evidence the application was sent on a given date, which matters for the quarter-start backdating explained below. Always check the address printed on the current version of the form before you post, as HMRC updates its handling addresses from time to time.

What happens after you submit: timescales, the approval number and backdating

There is no fixed statutory deadline for HMRC to decide an NRL1, and HMRC may approve an application after an initial check and review the detail later. In practice, a decision usually comes within around six weeks, though it can take longer if HMRC needs to verify your tax history or asks for more information. Treat that as a planning guide, not a guarantee. If you applied online, the submission shows in your Government Gateway account; if you posted the form and hear nothing for several weeks, contact HMRC's non-resident landlords team quoting your name and UTR or National Insurance number rather than assume it is progressing.

When HMRC approves the application it issues an approval (reference) number in the approval notice. This number is what makes the gross payment happen in practice: you pass it to each letting agent, and to any tenant who has to operate the scheme, and they use it to stop deducting and pay you in full. You do not apply for the reference separately, and there is no way to obtain it before approval, so keep the approval notice safe.

The more valuable point for cash flow is backdating. When HMRC approves your application, the approval date is normally the first day of the quarter in which HMRC received it. The scheme operates on quarters ending 30 June, 30 September, 31 December and 31 March. So an application HMRC receives in late August takes effect from 1 July; one received in February takes effect from 1 January. Any basic-rate tax withheld between that quarter start and the point your agent actually stops deducting can therefore be recovered, which is the subject of the next section.

Tax already deducted before approval: how to recover it

Tax withheld before your approval bites is not lost money. There are two routes back to you, and which applies depends on timing.

First, the backdating route. Because approval normally runs from the start of the quarter HMRC received your application, tax your agent withheld inside that quarter (before they switched you to gross) was, with hindsight, over-withheld. That can be recovered. Keep the year-end certificate (form NRL6) your agent or tenant must give you, because it is the evidence of how much was deducted.

Second, the Self Assessment route. Across the wider tax year, any tax deducted under the scheme is credited against your final Self Assessment liability. You report your gross rental income and allowable expenses, the tax already withheld is set against the tax you actually owe, and if more was withheld than you owe, HMRC repays the difference after you file. Where a repayment is due outside that mechanism, a non-resident landlord makes a repayment claim to HMRC directly. In most ordinary cases, filing your return and letting the deducted tax run through it is the cleaner path.

Where NRL tax deducted goes on your Self Assessment return

A frequent practical question is where the withheld tax actually appears on the return. You report the UK rental income and allowable expenses on the UK property pages (form SA105), and you enter the basic-rate tax deducted under the scheme as tax already taken off, so it is credited against the year's liability rather than charged again. Use the figure on your NRL6 certificate. If the deductions across the year exceed your actual tax, the excess is repaid once the return is processed. Our guide to non-resident landlord Self Assessment filing works through the pages in more detail.

A worked example: why gross payment usually helps

Suppose you let a UK flat from abroad for £30,000 of rent a year, with £8,000 of allowable expenses (mortgage interest is dealt with separately as a tax reducer, see below). Your taxable rental profit is £22,000.

Under deduction at source, your agent withholds basic-rate tax of 20% on the rent after the expenses they have paid, which can leave a meaningful sum tied up with HMRC well before your actual liability is known. With gross-payment approval, you receive the full £30,000, set your real expenses against it, and pay tax on the £22,000 profit through Self Assessment. For most landlords that improves cash flow and aligns the tax you pay with the tax you actually owe, rather than a flat 20% of rent. Remember that finance costs such as mortgage interest are not deducted from profit in the usual way: they give a basic-rate tax reducer instead, as our guide to Section 24 and the finance-cost restriction explains.

After approval: notifying your letting agents

Approval does not automatically reach your agent. Once HMRC issues your approval, you give your agent the approval reference number so they can stop deducting and pay you gross from then on. Provide the reference, confirm which properties the approval covers, and keep your contact details current with them. Most established agents handle the scheme routinely and will switch you to gross promptly once they have the reference on file.

If you let directly, with no UK agent, the obligation can fall on the tenant instead, but only where the rent exceeds £100 a week (£5,200 a year). Below that threshold a tenant is not required to operate the scheme. Where a tenant does have to deduct, your approval reference tells them to pay gross in the same way.

Self Assessment and MTD obligations after approval

Gross payment shifts the responsibility for the tax onto you. You must file a Self Assessment return for each tax year, by 31 January following the end of the tax year, declaring all your UK rental income and allowable expenses and paying any tax due. The filing detail, including the SA105 property pages, is in our non-resident landlord Self Assessment guide.

Two forward-looking points matter for planning. First, Making Tax Digital for Income Tax is now live and rolling in by income level: from 6 April 2026 for landlords and sole traders with qualifying income over £50,000, from 6 April 2027 at over £30,000, and from 6 April 2028 at over £20,000. If you cross the relevant threshold you will keep digital records and send quarterly updates, even filing from an overseas address. See our guide to MTD for landlords for what to do now.

Second, from 6 April 2027 property income in England, Wales and Northern Ireland is taxed at a separate set of rates: 22% basic, 42% higher and 47% additional. These are enacted, not proposed, by the Finance Act 2026 (sections 6 and 7), which received Royal Assent on 18 March 2026. Scotland sets its own income tax rates for Scottish-resident taxpayers; a non-resident landlord is taxed at the default UK rates, so 22/42/47 apply to their UK property income. The Section 24 finance-cost reducer rises in step to 22% from 2027/28, so a basic-rate landlord sees no new wedge, while higher and additional-rate landlords get relief at 22% rather than 20%.

Record-keeping and the changes you must report

HMRC expects you to keep records of all rental income received, your allowable expenses with supporting receipts, capital and improvement spend, and your agent statements and NRL6 certificates. Keep these for at least five years after the 31 January filing deadline for the relevant tax year.

You also need to tell HMRC when your circumstances change. Notify them if you acquire or dispose of a UK rental property, change your address abroad, appoint or change a letting agent, or cease to be a non-resident landlord. There is no rule that you must reapply every "12 to 24 months", another figure that circulates online but is not in the legislation. Approval continues while you remain compliant; the trigger for losing it is a slip in your tax affairs, not the passage of time.

If your application is refused or approval is withdrawn

HMRC refuses gross payment where your affairs are not in order, typically because of unpaid tax, late or missing returns, outstanding penalties or an open enquiry. If you are refused, HMRC will say why. The route back is to put the underlying problem right, bring filings and payments up to date, then reapply. There is no fixed penalty period to sit out; once your affairs are in order you can apply again.

The same logic applies to withdrawal. HMRC can withdraw an existing approval if your compliance slips. If that happens, your agent or tenant must resume deducting basic-rate tax until you are reinstated, and any tax due continues to be settled through Self Assessment. Staying on top of your filing and payment deadlines is the simplest way to keep approval in place.

Common mistakes to avoid

• Details that do not match HMRC's records. A name, address or reference that differs from what HMRC holds is the most common cause of delay. Check them before you submit.
• Missing a property. List every UK property you let, including any temporarily empty, not just the one prompting the application.
• Using the online service when you want an agent. If an accountant is to act for you, use the paper NRL1 plus the 64-8 from the outset.
• Posting to the wrong place. Send the paper form to BX9 1AU and keep proof of posting, so the receipt date that drives backdating is not in doubt.
• Applying with affairs in arrears. A late return or unpaid balance will usually get the application refused. Fix it first.
• Discarding the NRL6. The year-end certificate is your evidence of tax deducted and is what supports any reclaim and your Self Assessment entry.

When to get specialist help

Many landlords complete the NRL1 themselves, and for a single property with a clean tax record it is straightforward. Specialist help earns its keep where there is something to untangle: a prior period of non-filing to put right before applying, a portfolio across several agents, a recent move between countries that affects your residence position, or tax already deducted that needs reclaiming. We have helped non-resident landlords in exactly these situations get approved and recover withheld tax that had been written off as lost.

If you are weighing up whether to hold property personally or through a company while you are abroad, our guide to buy-to-let limited companies sets out the trade-offs, and our overview of UK property tax obligations for expats puts the NRL scheme in the wider picture. When you eventually sell, a separate set of rules applies: see our guide to non-resident capital gains tax on UK property, which carries a 60-day reporting and payment deadline. To understand how a specialist supports an application from start to finish, read what a property accountant does.

If you are about to apply for gross-payment approval, or you think tax has been over-deducted from your UK rent, use the form on this page to talk it through with a non-resident landlord specialist.