Non-resident landlords

Changes from 1 July 2023

The Finance Act 2022 introduced changes to the obligations of tenants and collection agents of non-resident landlords. These changes came into effect on 1 July 2023. For further information, please see Non-Resident Landlord Withholding Tax (NLWT).

These amendments provide that collection agents who act for a non-resident landlord may:

• deduct withholding tax from rental payments to non-resident landlords
• and
• remit that tax to Revenue.

This is currently at the standard rate of 20%. Previously, where a collection agent was appointed, the non-resident landlord was assessed and charged to tax in the name of the collection agent.

Where the collection agent deducts and remits the tax to Revenue, they will:

• no longer be designated chargeable and will not be responsible for filing an Income Tax Return (Form 11) or Corporation Tax Return (CT1) for the rental income
• withhold and remit 20% of the rental payment and make a Rental Notification (RN) through a new Non-Resident Landlord Withholding Tax (NLWT) system in myAccount and the Revenue Online Service (ROS)
• and
• be able to issue RNs in bulk.

Non-resident landlords should note:

• the removal of all current derogations
• the connection to credits from withheld payments in the new system
• and
• that they will be responsible for filing their Income Tax Return (Form 11) or Corporation Tax Return Form (CT1).

Tenants paying directly to a non-resident landlord:

• will not be designated as chargeable and will not be responsible for accounting for the withholding figure of 20% on their personal tax return
• and
• will withhold and remit 20% of the rental payment and make an RN through the NLWT system available on myAccount.

The Non-Resident Landlord Withholding Tax (NLWT) system

The new NLWT system enables tenants or collection agents to make RNs when making payments to a non-resident landlord. This notification (and accompanying payment) needs to be submitted within 21 days of paying the rent to the non-resident landlord.

The system is available to the tax agent, the collection agent, the landlord and the tenant. Landlords will be able to claim the withheld credits on their annual Income Tax Return (Form 11) or Corporation Tax Return (CT1).