AI agents for business finance: what they can and can't do
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The short answer
If you own the Nigerian property and are UK resident, the rent is your income for UK tax even when a sibling collects it, because UK law taxes the person receiving or entitled to the profits. You report the gross rent on the foreign pages of your return and deduct allowable costs, including anything your sibling spends on repairs or charges for managing it, at sterling values for the time each arose.
It is one of the most common family arrangements in the diaspora. You bought a flat in Ikeja or a duplex in Enugu; your brother finds tenants, collects the rent, fixes the generator and sends you what is left, or keeps it for family needs. Because the money may never reach your UK account, it is easy to assume it is not your income. For UK tax, it is.
The rule: the owner is taxed
Section 271 of the Income Tax (Trading and Other Income) Act 2005 says: "The person liable for any tax charged under this Chapter is the person receiving or entitled to the profits." If the property is yours and the tenants pay rent because you own it, you are entitled to the profits. Your sibling is acting as your agent. GOV.UK's page on tax on foreign income confirms UK residents normally pay UK tax on overseas rental income.
What happens to the money afterwards does not change that. If your sister keeps the rent and spends it on your parents, you have received rental income and then made a gift. Since 6 April 2025 there is no remittance basis to rely on; the only route to keep it out of UK tax is a FIG claim if you are a qualifying new resident, at the cost of your personal allowance (see the FIG trade-off).
When the answer is different
- Joint ownership. If the property is in both your names, each of you is entitled to your share of the profits, and you report only yours.
- The sibling is the real owner. If the title is in your sibling's name and you merely contributed, the position depends on who is beneficially entitled. This is a legal question worth settling in writing.
- Family home, no rent. If relatives live there free, there is no rent to report.
How to show it on your return
Overseas rent goes on the SA106 foreign pages. Box 14 takes total rents and other receipts, box 17 allowable property expenses. HMRC's SA106 notes say to convert the income into pounds "using the exchange rate at the time the income arose"; see which exchange rate to use.
| Item | How to treat it |
|---|---|
| Rent tenants paid to your sibling | Gross rent, box 14, even if you never received it |
| Your sibling's fee for collecting rent | Agent's fee, an allowable expense, if actually agreed and paid |
| Repairs your sibling paid from the rent | Allowable if repairs rather than improvements |
| Rent your sibling kept for family use | Still your income; then a gift by you |
| Nigerian tax deducted on the rent | Shown as foreign tax; may give foreign tax credit relief |
GOV.UK lists agents' fees, repairs that are not improvements, insurance and similar costs as allowable for landlords. More detail is in allowable costs on a Nigerian rental.
Worked example
Example only, with invented rates. Your Ikeja flat is let at ₦3,000,000 a year, paid in advance in May. Your brother takes a ₦300,000 fee by agreement and spends ₦400,000 on repairs. He sends you ₦1,500,000 and keeps ₦800,000 for your mother's care. At an example rate of ₦2,000 to £1 in May, gross rent is £1,500, expenses are £350 (₦700,000), and taxable profit is £1,150. The ₦800,000 kept for your mother is part of that profit, not an expense. Because gross rent is £1,500, you could instead deduct the £1,000 property allowance in place of actual expenses; that leaves a taxable profit of £500 rather than £1,150, so here the allowance is better. See the £1,000 property allowance.
Putting the arrangement on paper
Family arrangements work best when they are written down, even briefly. A one-page letter saying that your sibling collects rent on your behalf, what fee (if any) they take, what they may spend without asking, and when they account to you, does three jobs. It supports the expenses you claim, it shows HMRC who is entitled to the rent, and it prevents arguments later, especially if the property is ever sold or inherited. If your sibling keeps some rent as payment for their time, say so: an agreed fee is an expense, while an informal gift is not.
Your sibling may also have Nigerian tax questions of their own if they receive a fee for managing the property. That is for them to check under Nigerian rules.
Records to ask your sibling for
- A copy of each tenancy agreement and the rent amounts.
- A simple yearly statement: rent collected, dates, what was spent, what was sent, what was kept.
- Receipts for repairs and any agent or caretaker payments.
- Any withholding tax receipts from tenants who deducted Nigerian tax; see Nigerian tenants deducting WHT.
Where Pryme fits
Having rent paid into a naira account in your own name, rather than a relative's, makes the record clearer. A Pryme account holds NGN with local Nigerian account details and GBP side by side, and a verifiable statement from VerifyDoc.ai shows rent received in a form your adviser can check.
Questions people ask
My brother collects my rent in Nigeria. Do I need to declare it in the UK?
Yes, if you own the property and are UK resident. The owner entitled to the rent is taxed, whoever collects it.
Do I pay UK tax on rent I never received?
If you were entitled to it and it was collected on your behalf, yes. Money your sibling kept is treated as yours and then given away.
Can I deduct what my sibling charges for managing the property?
An agreed fee actually paid for managing or collecting rent is an agent's fee, which is an allowable expense.
What if the property is jointly owned with my sibling?
Each owner reports their own share of the rent and expenses.
Sources
- legislation.gov.uk: Income Tax (Trading and Other Income) Act 2005, section 271 · accessed Oct 2026
- GOV.UK: Tax on foreign income (updated 1 Oct 2026) · accessed Oct 2026
- HMRC: SA106 Foreign notes 2026 · accessed Oct 2026
- GOV.UK: Renting out a property, paying tax (updated 12 Dec 2024) · accessed Oct 2026
- GOV.UK: Tax-free allowances on property and trading income (updated 8 May 2019) · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.