A UK practice can act for clients who live abroad, but the work changes in three ways. Identity and risk checks have to replace the comfort of meeting the client, the UK tax position starts with residence rather than assumptions, and non residents cannot file through HMRC’s own online service, so the return goes through commercial software or on paper with the residence pages. Most problems come from treating an overseas client as a UK client with a foreign address.

What should you settle before accepting an overseas client?

Start with scope. A client who lives abroad usually needs help with UK income only, but the engagement has to say so expressly, because the client may assume you are also looking after the overseas tax return, or checking whether foreign tax relief has been claimed. Spell out which UK returns you will prepare, whether you will advise on residence, whether you will deal with the non resident landlord scheme or a property disposal, and that advice on the law of the country where the client lives is excluded unless you have arranged it with a local adviser. Our guide to engagement letters for accountants covers the general content; for overseas clients the scope, governing law and how notices will reach the client deserve the most care.

Practical questions follow from the client’s location. Agree how you will receive records, how you will be paid, what currency fees are in, and who receives HMRC post. HMRC letters often go to the address it holds, which may be an old UK address or a letting agent. Agree a time window for approvals, because a client several time zones away who signs on the last day of January leaves no slack.

What changes in the AML checks?

The Money Laundering Regulations 2017 do not prohibit acting for someone you never meet, but they shape the checks. Regulation 33(6) lists non face to face relationships without safeguards, such as a compliant electronic identification process, as a risk factor to weigh, and regulation 33(1)(b) makes enhanced due diligence compulsory for any business relationship with a person established in a FATF call for action country. In practice that means a reliable digital identity check or properly certified documents, a clear understanding of the source of funds for any UK property or investment, and a documented reason for the risk rating. The detail is in our page on due diligence on overseas and remote clients, and screening against the UK sanctions lists is covered in sanctions checks for accountants.

How do you establish whether the client is actually non resident?

Do not accept “I live abroad now” as the answer. Residence for individuals is decided by the Statutory Residence Test in Schedule 45 to the Finance Act 2013, and HMRC’s guidance note RDR3 sets out the order of the tests:

  1. Anyone in the UK for 183 days or more in the tax year is UK resident.
  2. Otherwise, meeting any automatic overseas test makes the person non resident. For example, someone resident in one or more of the previous three tax years is non resident if they spend fewer than 16 days in the UK, and someone resident in none of those years is non resident below 46 days. A third test applies to people working full time overseas who spend fewer than 91 days in the UK and work more than three hours on fewer than 31 UK days.
  3. If no automatic overseas test is met, the automatic UK tests and then the sufficient ties test decide the position.

Ask for a day count and a list of UK ties (family, accommodation, work, previous presence) every year, and keep it on file. In the year someone leaves or arrives, check whether one of the split year cases applies; HMRC’s Residence and FIG Regime Manual at RFIG21000 sets out each case, such as ceasing to have a home in the UK. A client who returns within a few years can also be caught by the temporary non residence rules.

Which UK income still has to be reported?

HMRC’s guidance for people living abroad says UK income such as pensions, rental income, savings interest and wages is usually still taxable even if the person is not UK resident. A Self Assessment return is usually needed if the client lives abroad and rents out UK property, works for themselves in the UK, has taxable interest from UK banks or building societies, has a pension outside the UK and was UK resident in one of the previous five tax years, or has other untaxed UK income. The same guidance says non residents do not usually pay UK tax on the State Pension or on interest from UK government securities.

The personal allowance is not automatic for non residents. GOV.UK says a non resident gets it if they are a British citizen, an EEA citizen, or worked for the UK government during the tax year, and may get it under the double taxation agreement with their country of residence. Outside a return, the claim is made on form R43 at the end of each tax year in which there is UK income.

How do you file a return for a non resident?

This is the filing point that catches practices out. HMRC’s guidance states that non residents cannot use HMRC’s online services to report their income. The return must instead be sent on paper with form SA109, filed through commercial software that supports SA109 reporting (often shown as a residence section), or filed by a tax professional using such software. A paper return for the 2025 to 2026 tax year must reach HMRC by 31 October 2026, against 31 January 2027 for an online return, so a client who insists on paper needs to know the earlier date.

For authority to act, set up the client relationship through your agent services account where you can. HMRC’s guidance says that if authorisation cannot be set up online the client must complete a paper form, and form 64-8 covers Self Assessment and most other taxes. Allow extra time for an overseas client to sign and post it.

What about UK property the client lets or sells?

Letting is the most common reason an overseas client needs a UK accountant. GOV.UK says anyone who lives abroad for six months or more a year is a non resident landlord for HMRC’s purposes, even if UK resident for tax. Unless HMRC approves gross payment, the letting agent (or the tenant, where there is no agent and rent exceeds £100 a week) deducts basic rate tax. The landlord applies on form NRL1i to receive rent gross, and HMRC will not approve the application if returns or payments are not up to date. The return then needs the residence section and the property pages (SA105). See the non resident landlord scheme.

Selling is the other trigger. HMRC’s guidance on non resident capital gains says the disposal must be reported, and any tax paid, within 60 days of completion, and that it must be reported even where there is a loss. Ask overseas clients to tell you before exchange, not after completion. Our page on non resident CGT on UK property covers the computation.

Does data protection allow you to send files abroad?

Sending a client’s own information back to them is not the issue. The rules on restricted transfers apply when your firm, being subject to UK GDPR, initiates a transfer of personal information to a separate organisation outside the UK, which is the ICO’s three step test. That can include an overseas adviser you instruct for the client, or an offshore processing provider. Map those flows and put the right safeguards in place; our page on data protection for accountancy practices has the wider picture.

What does this look like in practice?

Illustration only. A British citizen moved to Spain in August 2025 and keeps a let flat in Leeds. The practice verifies identity through a certified digital check, records the source of funds for the flat, and confirms there is no FATF call for action link. It obtains the day count and ties, reviews the split year cases for 2025 to 2026, and confirms the NRL1i approval is in place. The return is prepared in commercial software with the residence and property pages, claiming the personal allowance as a British citizen. The engagement letter excludes Spanish tax, and the client is reminded that any sale of the flat needs a 60 day report.

What are the common mistakes?

  • Assuming residence from the address on the file instead of applying the Statutory Residence Test each year.
  • Planning to file through HMRC’s free online service for a non resident, then missing the deadline when it will not work.
  • Forgetting the 60 day property return because the client mentioned the sale only at the year end.
  • Rating every overseas client the same, without recording why the risk is low, normal or high.
  • Leaving foreign tax and treaty relief out of the engagement letter, so the client assumes you have covered it.

Solar Protect runs fee protection schemes for accountancy and bookkeeping practices. See how our accountant schemes work or read fee protection schemes for accountants.

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Sources

Reviewed by Christine Anderson, Broker, Solar Protect. Last reviewed 8 October 2026. Part of Accountapedia, the Solar Protect guide to UK tax and accounting. This page is general information, not personalised advice.