NRL1 and UK rental income after moving to Argentina

If a UK flat is still bringing in rent after you settle in Argentina, your letting agent will normally deduct tax before paying you. Form NRL1 asks HM Revenue & Customs (HMRC) to authorise payments without that Non-Resident Landlords Scheme (NRLS) deduction. The deduction is currently 20% (2026/27) of rent after allowable expenses the agent pays, an advance against your eventual UK tax bill rather than a final charge. Gross-payment approval frees up the cash now; UK rental profit remains taxable, and Argentine tax residence can create another reporting obligation.

Who takes tax from the rent?

NRLS is based on a landlord's usual place of abode. Living outside the UK for more than six months normally brings you within the scheme, even with a UK address or a UK agent collecting the rent. Nationality, bank location and the residence status on a tax return do not determine who withholds. The payer must continue operating NRLS until HMRC authorises gross payment and notifies them.

An agent can reduce the withholding base by qualifying running expenses it actually pays, such as management fees and qualifying repairs. Expenses paid directly by the owner and residential mortgage finance costs do not simply reduce that base. Gross-payment approval changes the scheme deduction, not the agent's fee. When a move changes who receives the rent, the agent or tenant needs to know before the next payment.

Applying for gross payment

Each individual owner applies separately for their own share using NRL1; a company or trustee uses a different form. HMRC's individual application service or form asks for your name, National Insurance number or UK tax reference if available, overseas home address, UK property details and the details of your agent or direct-paying tenant. An actual Argentine home address matters more than an old UK correspondence address. The application carries no HMRC fee.

HMRC considers eligibility, including whether tax affairs are up to date, then writes to the payer with an effective date. Sending NRL1 alone does not permit withholding to stop, so an early application, before departure or when letting begins, helps avoid an assumed gross-payment date. If an agent changes or rent begins coming directly from the tenant, HMRC needs the new payer details. Approval can be withdrawn if tax obligations are not met.

Where two people own the property, one person's approval covers only that person's share. Annual rent statements, invoices and certificates for any tax deducted before approval make the later calculation possible. Previously withheld tax is credited through the UK tax calculation; approval does not retrospectively erase it.

The UK return follows profit rather than the agent's payment

NRL1 leaves Self Assessment in place. UK property income may need a return on the property pages (SA105) and, where relevant, residence pages (SA109); someone not yet registered may need to register and tell HMRC about the income. The calculation starts with rent before agent fees and NRLS deductions, then takes account of qualifying costs and tax withheld. A British citizen can normally claim the UK personal allowance while non-resident if eligible. Its standard amount is £12,570 for 2026/27, subject to income limits, and a required return remains due even when the allowance covers the profit.

Agent fees, insurance and repairs that maintain rather than improve the property are generally deductible in calculating profit. For an individual with a residential buy-to-let mortgage, finance costs generally produce a basic-rate tax reduction instead of reducing rental income, with limits and possible carry-forward of unused relief. Capital improvements and mortgage principal repayments are not running costs. Statements covering the UK tax year, 6 April to 5 April, should include periods either side of departure. For 2026/27, the usual deadline to notify HMRC of a new charge is 5 October 2027, while online Self Assessment and balancing payment are generally due 31 January 2028. The UK tax after a move guide covers the wider return.

How the deduction compares with the final bill

Consider a British citizen living in Buenos Aires who lets an English flat for £1,500 monthly for all 12 months of 2026/27. Of the £18,000 rent, the agent pays £1,800 in management fees and £1,200 for qualifying repairs. Without NRL1 approval, the agent's illustrative withholding base is £15,000, yielding a £3,000 deduction. The owner separately pays £300 insurance, leaving property profit of £14,700 before any finance-cost relief.

Assume no other UK taxable income, a full £12,570 personal allowance and a 20% basic rate. Illustrative final UK income tax is 20% × (£14,700 − £12,570) = £426. The £3,000 withheld exceeds that bill by £2,574, to be reconciled with HMRC. Had approval reached the payer before the first rent payment, no £3,000 scheme deduction would have been made, but the £426 tax would still arise. Other income, co-ownership, finance costs, a part-year tenancy or different expenses change these figures.

Where Argentina enters the calculation

Argentine tax residence can bring UK rental income into an Argentine impuesto a las ganancias (income tax) return to ARCA, Argentina's tax authority, formerly AFIP. Immigration residence follows a different test. The UK–Argentina double tax treaty allows the UK to tax income from UK land and provides relief provisions, while an Argentine foreign-tax credit depends on local rules and limits. UK returns, evidence of UK tax actually paid, letting statements and the dates of Argentine tax residence help reconcile the two systems. Argentina uses a calendar tax year rather than the UK year, so the periods and currency conversions may differ.

A P85 departure form addresses a departure and possible PAYE overpayment; NRL1 deals with withholding from rent. UK residence itself follows the Statutory Residence Test, rather than the date of the flight. If the flat is sold instead, a non-resident sale can require a 60-day UK property capital gains return; the UK property sale guide covers that event.

For a landlord whose final tax is far below the agent's deduction, NRL1 chiefly changes when the money is available. Keeping the gross rent, expenses and withholding visible in both countries is what makes the final figures intelligible.