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Non-resident investors that rent UK residential and commercial real estate are subject to tax on the rental income derived from the properties. The non-resident will also be subject to tax on any gain arising on the eventual disposal of the UK property. The tax consequences vary depending on the choice of vehicle used to acquire the property.

This note considers the UK tax implications where the UK property is acquired by a non-resident that is:

1. •

   a company

2. •

   an individual

Regardless of the choice of acquisition vehicle, the UK operates a withholding tax regime for rents payable to non-UK resident landlords known as the non-resident landlords scheme (NRLS). For more information on the scheme, see the Non-resident landlords scheme (NRLS) guidance note.

The taxation of capital gains realised by non-resident investors on UK land or property has changed significantly from 6 April 2019. From that date, all disposals of UK property by non-residents were brought within the scope of UK tax (commercial