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Withholding tax in United Kingdom 2026
The UK is unusually light here: dividends leave the country with zero withholding, while interest, patent royalties and rents to non-residents carry 20% at source — often reduced or removed by treaty.
At a glance
- top rate
- 20% basic-rate withholding
- entry band
- 0% on dividends
- tax year basis
- Taken when the payment is made
- filing deadline
- Event-based
- residency basis
- UK income of non-residents
- regime flag
- Non-resident landlords can register to receive rents gross
Rates
Withholding on non-residents 2026/27
| Rate | Base | Applies to |
|---|---|---|
| 0% | — | Dividends (treaties permit up to 15%, but UK law charges nothing) |
| 20% | Gross | Interest paid abroad (many exemptions: bank interest, national savings, quoted Eurobonds) |
| 20% | Gross | Patent royalties (no withholding on most other royalties) |
| 20% | Gross | UK rents — unless registered with the tax authority to be paid gross |
| Payroll rates | UK workdays | Salaries for work performed in the UK |
Thresholds & allowances
- Personal allowance for non-residents£12,570 where eligible
British and European Economic Area nationals and many treaty residents qualify
Residency
Residency trigger
These rules apply to people outside UK tax residence, on income arising in the UK.
Non-resident treatment
Treaties typically cut the 20% rates; sales of UK land by non-residents are taxed through a 60-day return rather than withholding; from April 2026 the notional dividend credit for non-residents is abolished.
Notes
- UK pensions paid abroad usually stay within payroll withholding unless a treaty assigns them to the residence country.
- Non-resident entertainers and sportspeople face withholding on UK performance income.
- Temporary non-residents returning within 5 years can be taxed on gains — and from April 2026 on certain company profits taken as dividends while away.
FAQ
Does the UK withhold tax on dividends to foreign investors?
No — 0% at source under UK law, which is a key reason UK shares are popular with international holders.
What is withheld on UK rent paid to an overseas landlord?
20% by the tenant or letting agent — unless the landlord registers under the non-resident landlord scheme to receive rent gross and settle tax by return.
Figures: tax year 2026/27, compiled from public sources. Not tax advice.