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Property often carries emotional weight for British expats. It can represent home, security, identity, and a continuing connection to the UK - even after you’ve moved abroad.
That’s why expats often say things like:
Emotionally, that makes sense. From a tax perspective, property is rarely “set and forget”. Unlike most investments, property is located in one country, governed by that country’s laws, and often creates obligations even when you feel like nothing is happening.
UK and overseas property can affect:
This guide is designed to be educational. It summarises the main UK rules and common cross-border issues expats encounter in practice, based on UK law and HMRC practice as at 31 December 2025 (relevant to 2025/26 and 2026/27 planning).
It is not about making property look “bad”. It is about recognising that property is one of the few assets where timing, residence status and documentation can matter as much as the numbers.
Important note:
This article is provided for general information only and does not constitute tax, legal or financial advice. UK tax outcomes depend on individual circumstances and can change. Professional advice should always be taken before acting on any of the points discussed.
Many British expats retain UK property and/or buy property overseas. Unlike many investments, property is immovable and heavily regulated locally. That means it can create tax liabilities and filing obligations in more than one jurisdiction.
For UK purposes, property is also one of several factors that can indicate ongoing UK connections. Where the automatic SRT tests do not determine residence, UK ties (including accommodation) and day counts can become decisive.
Importantly, HMRC does not apply a single ‘centre of life’ test in the way some countries do; instead the UK relies on the SRT’s statutory framework. In practice, however, a home that is available to you, patterns of UK visits, and family/work ties can materially affect outcomes.
Property is frequently misunderstood cross-border because:
A practical theme runs through all of this:
Property does not just create tax when you sell.
It can create tax and compliance while you hold it, rent it, finance it, change ownership, or move countries.
Whether you live in Dubai, Singapore, Spain, Portugal, Australia, Hong Kong, or elsewhere, the UK property rules remain broadly consistent. Your residence position affects how you are taxed, but UK property stays UK property.
Rule 1 - UK rental income is UK-source and generally within UK income tax
UK rental profits are generally taxable in the UK as UK-source income. If you are tax-resident elsewhere, that country may also tax the same income. Double tax relief is often achieved via foreign tax credit, depending on the treaty and local law, rather than a blanket exemption. The practical point is that UK property income commonly brings UK compliance mechanics even where you live abroad.
Rule 2 - The Non-Resident Landlord Scheme (NRL Scheme) can apply where your usual place of abode is outside the UK
Without approval to receive rent gross, a letting agent (or, in some cases, the tenant) may have to withhold tax at the basic rate from rent and pay it to HMRC. A key nuance: the NRL Scheme test is based on your usual place of abode being outside the UK, which can differ from your SRT residence outcome in certain cases.
Rule 3 - UK returns: many non-resident landlords will need Self Assessment, but requirements are fact-specific
Whether you must file depends on your circumstances and whether HMRC issues a notice to file. Many non-resident landlords do file to finalise liability, reconcile any withholding, and claim allowable expenses/reliefs where applicable. A common misconception is that withholding under the NRL Scheme is always “the final answer”. Often it is not.
Rule 4 - Non-residents can be within UK tax on disposals of UK land (and reporting can apply even if no tax is due)
Since 6 April 2020, non-UK residents generally must report disposals of UK land, even if no UK CGT is payable (for example, due to losses or exemptions). Different regimes can apply depending on whether the owner is an individual, company, trustee, or widely held vehicle. Identifying who owns the asset for tax purposes matters.
Rule 5 - Reporting and payment deadlines can be strict
Non-residents disposing of UK land generally report through the UK property disposal reporting service within 60 days of completion, with payment due by the same deadline where tax is payable. In practice, people often anchor to exchange. For these rules, completion is usually the date that drives the clock.
Rule 6 - Section 24 interest restriction applies to individuals, including many expat landlords
For individual landlords, mortgage interest is generally relieved via a basic-rate tax reduction rather than a full deduction. This can affect effective tax rates, especially where rental income pushes someone into higher-rate bands or where interest costs are high relative to rent.
Rule 7 - SDLT: the 2% non-resident surcharge can apply to purchases of residential property in England and Northern Ireland
The SDLT residence test is separate from the SRT and is based on UK presence rules. Where it applies, it generally applies to the whole transaction consideration. The surcharge can also apply where any purchaser in a joint purchase is non-resident for SDLT purposes. There is also a repayment mechanism if the relevant UK presence condition is met within the permitted timeframe. Whether that is realistic depends on future travel and life plans.
Rule 8 - UK IHT: UK property is a UK-situated asset; wider exposure depends on status
UK land and buildings are generally within UK IHT as UK-situated assets. Whether overseas assets are within UK IHT depends on the post-6 April 2025 IHT framework for internationally mobile individuals and other IHT provisions. Spousal exemptions, nil-rate bands and reliefs also matter, so the headline rate is rarely the full story.
Expats buy overseas property for:
But overseas property brings its own layers of complexity and additional compliance.
You may owe tax where the property is located
You may also face UK tax in parallel in some scenarios
This is most likely where:
Treaties typically allocate taxing rights and provide a mechanism to mitigate double taxation, often via foreign tax credit.
They rarely remove compliance obligations, and they do not prevent countries from applying their domestic definitions, computational rules, and filing requirements.
Moving country can change outcomes
Tax outcomes often change around:
From 6 April 2025, changes to the UK IHT framework for internationally mobile individuals can bring overseas assets into scope in some circumstances where conditions are met (often described as a “10 out of 20 years” test, with a potential “tail” after leaving).
This is another reason overseas property now needs to be considered not only for income and CGT, but also for estate exposure.
A UK home can make you UK resident again under the SRT in some cases, particularly where the sufficient ties test applies.
Accommodation tie
An accommodation tie can arise where UK accommodation is available for a continuous 91-day period and the individual uses it. HMRC guidance indicates that even “casual use” can be sufficient in relevant cases. The detailed conditions depend on the legislation and the facts.
In practice, issues often arise where:
Work tie
A work tie can arise where you work in the UK for 3 hours or more on a sufficient number of days in the tax year (commonly summarised as 40 days, subject to the detailed conditions).
Family tie
If your spouse or minor children live in the UK.
Country tie
If you spend more days in the UK than in any other single country (relevant in specific leaver scenarios).
90-day tie
If you spent 90+ days in the UK in either of the two prior tax years.
Combine ties
Under the sufficient ties test, relatively low UK day counts can still lead to UK residence depending on whether you are an arriver or leaver and how many UK ties apply.
Property is often the trigger that impacts residency planning because it affects both day-count behaviour and tie analysis. The risk is rarely one single trip - it is the combination of availability, use, and pattern over the year.
Selling UK property while abroad is mainly a question of:
For non-UK residents, disposals of UK land are generally reportable within the 60-day window from completion, even where no UK CGT is due.
For UK residents, UK CGT can apply to gains on UK and overseas assets (subject to reliefs, exemptions and any applicable double tax relief).
Residence status in the disposal year can therefore materially change the UK analysis.
A common pattern is that someone plans a sale while abroad, but then UK presence increases in the same year:
In those cases, the issue is not that the rules “change”. It is that the taxpayer’s status for that year may have changed.
Selling Overseas Property as a British Expat
Overseas property interacts with UK tax in complicated ways, mainly because two countries may tax the same disposal.
Why credits do not always “wipe out” the bill:
Many countries classify property returns differently. That means the foreign tax credit position can be more complex than expected.
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From 6 April 2025, changes to the UK’s approach to IHT for internationally mobile individuals mean that residence history can be a more prominent factor in assessing when overseas assets may fall within scope. This is often summarised in commentary as a ‘10 out of 20’ style concept, but the detailed outcome depends on the legislation, transitional rules and the individual’s timeline.
What this changes in practice is that expats may need to consider IHT exposure by reference to UK residence history, not just current location.
Property is often central here because it tends to be:
The rate of IHT, and how much is actually payable, depends on the wider estate, exemptions, nil-rate bands and reliefs. So the analysis is about exposure and structure, not just headline percentages.
These are simplified examples for education. Actual outcomes depend on residence status, reliefs, valuations, elections and foreign tax credits.
Case Study 1 – The Dubai family who kept a UK home
A UK home is retained and remains available. UK visits increase and the family stays in the property. Depending on day counts and ties, UK residence status could change under the SRT, potentially widening UK tax exposure for that year.
Case Study 2 – The Spain retiree who sold at the wrong time
A Spanish property is sold close to a UK return. The timing creates a risk that the UK taxes the gain in the same year as Spain, and credit relief does not fully offset due to differences in computation.
Case Study 3 – The Singapore executive with a UK buy-to-let
NRL Scheme paperwork is not completed and withholding occurs at basic rate. Cash flow is affected and the UK compliance position still needs to be finalised.
Case Study 4 – The Portugal returner with unclear documentation
A foreign property is sold and funds move across accounts without clear records. When the individual returns, evidencing the nature of funds and the relevant tax treatment becomes more complex than expected.
Case Study 5 – The global nomad with a UK base
A UK property is used during visits and becomes a regular base. Day counts increase and ties accumulate. The individual assumes they remain non-resident, but the SRT analysis becomes finely balanced.
One of the most common surprises for British expats buying residential property in England or Northern Ireland is the 2% SDLT non-resident surcharge.
Key points:
The practical takeaway is to model SDLT costs early and treat the surcharge as a real possibility if UK presence is limited.
Buying abroad adds a second layer of complexity because countries differ on:
Country snapshots (high level):
Spain
Portugal
France
UAE / Dubai
Cyprus
Singapore / Hong Kong
Joint ownership often looks simple.
In practice, tax outcomes depend on ownership, documentation and residence status.
Rental income follows beneficial ownership (and spouse rules can differ)
Rental income is taxed based on beneficial ownership (who is entitled to the income and capital value), not simply whose name is on the mortgage.
For spouses and civil partners, the UK has default rules that often allocate income 50:50 unless specific conditions are met and evidenced.
Changing ownership proportions can trigger CGT and/or SDLT issues
Changing beneficial shares can be a disposal for CGT purposes. Transfers between spouses can be tax-neutral in some cases, but outcomes depend heavily on residence status and whether debt is involved.
Mixed-residency couples can face SDLT surcharge issues
For SDLT, if a purchase is joint and any purchaser is non-resident for SDLT purposes, the surcharge can apply to the whole transaction.
Staggered returns can change outcomes year-by-year
If spouses return to the UK in different tax years, residence status can diverge. That can affect:
Inheritance treatment depends on status and structure
IHT outcomes for jointly owned property depend on multiple factors including status under the post-6 April 2025 framework, the situs of assets, and spousal exemption rules. This is an area where assumptions often fail.
Expats sometimes buy property through:
This can be appropriate in some cases, but it changes the tax profile and increases compliance.
Potential reasons company ownership is considered:
Whether a corporate structure is beneficial depends on the full facts, including financing costs, extraction strategy, local tax and administrative burden.
Common areas where complexity increases:
Company ownership is not automatically “better”. It is a structural choice that trades one set of outcomes for another.
Historically, some expats used trusts for estate planning and IHT mitigation, particularly in the non-dom era.
The post-6 April 2025 framework changes how many families need to think about long-term residence history, and trust outcomes remain highly fact-specific.
Key points to understand:
Trust planning now requires careful, current analysis and should not be based on legacy assumptions.
British expats often finance property with:
Financing affects more than cash flow.
Common considerations:
Returning to the UK can change the UK tax position quickly.
Common impact areas:
Before leaving the UK, many expats gather and keep evidence on:
Leaving without clear records does not necessarily create tax, but it often makes later compliance harder.
This is a practical educational checklist used to reduce surprises:
Property can be emotionally reassuring - but cross-border outcomes depend on residence status, local law, UK rules, timelines and documentation.
Property isn’t the problem. Misunderstanding how multiple systems interact is. With the right clarity on residence, reporting, structure and timing, most issues become manageable and predictable.
This article is provided for general informational purposes only. It does not constitute tax advice, legal advice, financial advice, or a recommendation to take (or refrain from taking) any action. Tax outcomes depend on individual circumstances, the precise facts, and the law and HMRC practice in force at the relevant time (including changes announced but not yet enacted). No reliance should be placed on this article as a substitute for obtaining personalised advice from a suitably qualified professional. No professional relationship is created by reading or relying on this content.
Shil Shah is Skybound Wealth’s Group Head of Tax Planning and a Private Wealth Adviser, based in London. He works with clients who live global lives, executives, entrepreneurs, families and professionals who want clear, confident guidance on their wealth, their tax position and the decisions that shape their future.
Property decisions rarely operate in isolation. They interact with residency status, timing, reporting rules and long-term tax exposure. In a private introductory session with our tax team, you’ll:
If you own property across borders, clarity is essential – not optional.
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The shift from domicile-based to residence-based taxation is the biggest change British expats have faced in decades.
Your residency history will now determine whether your global estate is exposed to UK inheritance tax.
If you’ve ever lived in the UK - or you may return one day - you need to understand exactly where you stand under the new 10/20 rule and tail period.
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Property ownership creates some of the most complex tax and compliance outcomes British expats face. UK and overseas property can affect income tax, capital gains tax, residency analysis and inheritance tax exposure in ways that are often underestimated.
A focused discussion can help you:
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