If you are an overseas investor looking to purchase a property in Liverpool or Manchester, you are not alone. In fact, two thirds of properties in the UK are bought by foreign investors and buy-to-let properties continue to be attractive and compelling investments. A reason for this is the long-term stability and capital growth potential within the UK’s growing rental market.
Liverpool and Manchester have positioned themselves as top buy-to-let destinations due to their high student populations, economic growth and vast job opportunities. In addition, with property prices being much lower than London, the two growing cities offer some of the highest rental yields in the country. For example, forecasting by agent Savills has predicted that the North West will achieve the highest capital growth over the next five years, estimating 29.4% growth by 2029 .
You can find out more information on why Liverpool and Manchester are great investment cities by reading our property investment tips for the two cities.
At Qube Residential, we are one of the top property management services for foreign investors in Liverpool and Manchester and we understand that although buy-to-lets are fantastic investments, they can be difficult to navigate. That’s why we are here to help!
What are the requirements of an overseas but to let (BTL) landlord?
- If you are a resident of one of the following countries then you may be able to apply for a UK mortgage.
- You need to have a basic annual income of at least £50,000 or £75,000 if you are self-employed.
- You will need a 25% deposit or 40% for mortgages over £1million – 60% – 75% loan-to-value (LTV).
- You will need to provide proof of overseas income and employment.
- UK lenders will carry out a credit check to determine your eligibility for a mortgage.
- You are often required to have a UK bank account.
What are the imposed buy to let (BTL) taxes?
Stamp Duty Land Tax (SDLT)
- Stamp Duty Land Tax (SDLT) is a one time tax which is paid when a property is purchased in either England or Northern Ireland. There are three layers of SDLT charges that a foreign investor will be faced with:
As of April 2025
- Property Price SDLT Rate
- £0 – £250,000 0%
- £125,001 – £250,000 2%
- £250,001 – 925,000 5%
- £925,001 – £1.5m 10%
- £1.5m + 12%
A 3% surcharge is added on top of the standard SDLT rates for all buy to let properties
All foreign investors must pay an extra 2% surcharge on top of the additional SDLT rate and 3% surcharge.
There is a total 5% SDLT surcharge on top of all standard rates for foreign investors.
For more information on SDLT please read here for more information.
Capital Gains Tax (CGT)
- CGT is a tax which is paid on the profit of a UK property when it is sold. The amount which needs to be paid is a percentage of the difference between the purchase price and the sales price.
- The first £3,000 is tax free, but after that there is 24% tax on the gains.
Income Tax
- If you a foreign buy to let investor in the UK then you will need to pay income tax on your monthly rental income.
- To pay this tax it is mandatory that foreign investors join the Non-Resident Landlord Scheme (NRLS) to ensure that money is taxed properly before leaving the UK. Usually letting agents will deduct your tax and send it to HMRC.
- £0 – £12,570 – 0% (personal allowance)
- £12,571 – £50,270 – 20%
- £50,271 – £125,140 – 40%
- £125,140 + – 45%
*Non UK residents may NOT be eligible for the personal allowance of £12,570 unless specified under a Double Taxation Agreement.
NRLS Registration
Every overseas investor/ landlord must be registered with the NRLS in order for rental income to be taxed.
The person aka ‘Letting Agent’ who manages the property on behalf of the overseas landlord must deduct the tax from the landlord’s income and pay it to HMRC.
Council Tax
Council Tax is a compulsory tax on residential properties which is used to pay for local services such as bin collections and schools.
Usually if a property is tenanted then the landlord can make it a requirement for the tenant to pay the council tax. However, if a property is empty then it is the landlord’s responsibility to pay this tax and the price is dependent on the price of the property and the area it is in which is referred to as bands.
What are the responsibilities for a buy to let landlord?
The responsibilities of a landlord are the same for both UK citizens and non-UK citizens:
- The property must be safe and free from health hazards such as dampness.
- Landlords must protect their tenant’s deposit in a government approved scheme.
- Fit and test smoke alarms and carbon monoxide alarms.
- Ensure all gas and electrical equipment is installed correctly, safely, and maintained.
- Provide an Energy Performance Certificate (EPC) for the property.
- Carry out a right to rent check on potential tenants.
- Follow rules on rent increases.
- Ensure the water supply is working properly and free from Legionella.
- Landlords are responsible for the majority of repairs in the property including a faulty boiler, leaks, and exterior issues.
For more information on landlord responsibilities including evictions, making repairs, and paying tax and national insurance please visit the government’s website.
Although this is a lot of information to take in, these stringent laws and taxes are imposed to protect both landlords and tenants. Manchester and Liverpool present compelling investment opportunities for international buyers, backed by sustained growth, strong rental demand, and ongoing urban development that promise long-term returns.
If you are interested in finding out more about Liverpool or Manchester property management for foreign buyers, please get in touch.
