Buying UK property from the USA.

One point is specific to Americans: the United States taxes its citizens by reason of citizenship, and the UK and US convention preserves that. For US citizens, UK rent and gains can therefore be taxable in both countries, with the convention's relief article providing a credit for UK tax. A US tax adviser can confirm how this applies to you.

PROXERA Wealth works across buy-to-let, below-market-value, new homes and off-plan, and short-term lets. See the current developments or our guide to investing in UK property.

Stamp Duty Land Tax when you buy

Stamp Duty Land Tax (SDLT) applies to residential purchases in England and Northern Ireland. Scotland and Wales have their own taxes, and the non-UK resident surcharge does not apply there. Two surcharges stack on the standard rates:

• Higher rates for additional properties, 5%. Added to every band if, after the purchase, you will own more than one residential property worth £40,000 or more anywhere in the world. A home in the USA counts.
• Non-UK resident surcharge, 2%. Added if you have not been present in the UK for at least 183 days in the 12 months before the purchase, on top of all other residential rates.

A worked example: an investor living in the USA who already owns a home there buys a £350,000 buy-to-let in England. SDLT is £32,000, of which £7,000 is the non-resident surcharge. A UK resident buying the same additional property would pay £25,000.

If all the buyers spend at least 183 days in the UK in a continuous 365-day period that starts no more than 364 days before completion and ends no more than 365 days after it, the surcharge may be reclaimable within 2 years. Your conveyancer usually files the SDLT return and pays the tax within the 14-day deadline after completion. Companies generally pay the higher rates, and a 17% rate can apply to company purchases above £500,000. Estimate your figure with the stamp duty calculator, and see our guides to stamp duty on second homes and limited company buy-to-let.

Tax on your rent: the Non-Resident Landlord Scheme

HMRC classes you as a non-resident landlord if you live abroad for 6 months or more a year. Your letting agent must then deduct basic rate Income Tax from the rent, after the expenses they pay, and pass it to HMRC each quarter. With no agent, a tenant paying more than £100 a week must deduct it. To receive rent without deduction, you apply on form NRL1, and HMRC will not approve it if your UK taxes are not up to date. Either way, you declare the rent on a UK Self Assessment return unless HMRC tells you not to.

Income Tax on your rental profit

Income Tax is charged on your rental profit: the rent less allowable expenses such as agent fees, insurance and repairs. An individual landlord cannot deduct mortgage interest; relief for residential finance costs is restricted to the basic rate, and this applies to non-UK residents. For 2026 to 2027 the rates are 20% from £12,571 to £50,270, 40% to £125,140 and 45% above. Living abroad, you get the £12,570 Personal Allowance if you are a British or EEA citizen, have worked for the UK government in the tax year, or the double taxation agreement with your country of residence provides for it.

From 6 April 2027, property income has its own rates of 22%, 42% and 47% (Finance Act 2026, section 7), and the government's technical note says Non-Resident Landlord Scheme deductions and finance cost relief move to the 22% property basic rate. GOV.UK says non-resident landlords cannot use HMRC's own online services for their return, so it is filed with commercial software, on paper by 31 October, or through an accountant. Model your figures with the landlord tax calculator.

Capital Gains Tax when you sell

Living abroad does not take a sale of UK property or land out of UK tax. For individuals in 2026 to 2027, Capital Gains Tax is 18% on gains within the basic rate band and 24% above it. You report the sale through a Capital Gains Tax on UK property account and pay any tax within 60 days of completion, even if there is no tax to pay or you made a loss; late reports can bring interest and penalties. Non-UK resident companies pay Corporation Tax on these gains instead. Try the capital gains tax calculator.

Inheritance Tax on UK property

Since 6 April 2025, Inheritance Tax depends on residence rather than domicile. If you have been UK resident for the previous 10 consecutive years, or 10 or more of the previous 20, you are a long-term UK resident and assets outside the UK can be in scope. If not, Inheritance Tax applies only to your UK assets, which include UK property, at 40% on the part of an estate above the £325,000 threshold.

The United States is listed on GOV.UK among the countries with a double taxation convention that applies to Inheritance Tax, with a date of entry into force of 11 November 1979. We have not summarised its articles here. An adviser can confirm how it applies to an estate that includes UK property.

The UK and US income tax convention was signed on 24 July 2001 and amended by a protocol signed on 19 July 2002. It entered into force on 31 March 2003, with UK effect for Income Tax and Capital Gains Tax from 6 April 2003. GOV.UK also lists two competent authority agreements signed in July 2021.

What the articles we have read say:

• Citizens, Article 1(4). Each country may tax its residents, and by reason of citizenship may tax its citizens, as if the convention had not come into effect, subject to listed exceptions that include the relief from double taxation article.
• Rental income, Article 6. Income a US resident derives from real property in the UK, including from letting it, may be taxed in the UK.
• Gains, Article 13. Gains a US resident makes on selling UK real property may be taxed in the UK. For the UK, real property also includes shares not regularly traded on a stock exchange that derive their value, or the greater part of it, from UK real property, and interests in partnerships or trusts holding UK real property.
• Relief, Article 24. In accordance with, and subject to the limitations of, US law, the United States allows its residents and citizens a credit against US income tax for income tax paid to the UK.

In short, the UK keeps the right to tax your UK rent and gains, and the US gives credit for UK tax under its own rules. We have not summarised the other articles of the convention.

The gap depends on your US time zone, and on the fact that the US and the UK change their clocks on different dates. US daylight saving time runs from 2am on the second Sunday in March to 2am on the first Sunday in November. UK summer time runs from the last Sunday in March to the last Sunday in October. For a few weeks each spring and autumn the gap is one hour shorter than usual: this autumn, that is between the UK change on 25 October 2026 and the US change on 1 November 2026.

Most of Arizona and all of Hawaii do not observe daylight saving time, so the gap to London there changes only when UK clocks do: 7 hours (Arizona) and 10 hours (Hawaii) in the UK winter, and 8 and 11 hours during British Summer Time. For most of the year, 9am in New York is 2pm in London.

UK clocks go forward 1 hour on the last Sunday in March, into British Summer Time (BST), and back to Greenwich Mean Time (GMT) on the last Sunday in October. The next changes are on 25 October 2026 and 28 March 2027.

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