Buy-to-Let Calculator 2025/26
Rental yield, Section 24 tax impact, and SDLT surcharge — for UK landlords.
Try another scenario
How to Use This Calculator
Tab "Rental Yield"
Enter the property price and monthly rent to see gross and net yield instantly. The calculator deducts realistic costs — management fees, maintenance, insurance, void periods, and letting agent fees — to show your true return. Add your mortgage details to see monthly cash flow, annual profit, and ROI on cash invested. The ICR (Interest Coverage Ratio) shows whether your rent meets lender requirements.
Tab "Section 24 Tax"
Enter your rental income, mortgage interest, and other income to see exactly how much Section 24 costs you. The calculator compares the old rules (interest fully deductible) with current rules (20% tax credit only) and shows the additional tax you pay. Higher-rate and additional-rate taxpayers are hit hardest.
Tab "SDLT Surcharge"
Enter the property price and select whether it is an additional property. The calculator shows standard SDLT plus the 5% additional property surcharge (from October 2024). Switch between England, Wales, and Scotland to compare different tax regimes — Scotland charges 6% ADS and Wales charges 4% higher rates.
Rental Yield Formulas
= (Annual Rent / Property Price) × 100
Net Rental Yield
= ((Annual Rent − Annual Costs) / Property Price) × 100
Annual Costs include:
• Management fee (typically 10% of rent)
• Maintenance allowance (typically 10% of rent)
• Landlord insurance
• Void periods (lost rent when property is empty)
• Letting agent fees (tenant find, renewals)
ROI on Cash Invested
= (Annual Profit / Cash Invested) × 100
where Cash Invested = Property Price − Mortgage Amount
ICR (Interest Coverage Ratio)
= Annual Rent / Annual Mortgage Interest
Lenders typically require ICR ≥ 125% at a stress rate of 5.5%
Old rules: Tax on (Rental Income − Mortgage Interest) at marginal rate
Current rules: Tax on full Rental Income at marginal rate, minus 20% tax credit on interest
Additional tax = Current tax − Old tax
SDLT (England, from April 2025)
0% on first £125,000
2% on £125,001 – £250,000
5% on £250,001 – £925,000
10% on £925,001 – £1,500,000
12% above £1,500,000
+ 5% surcharge on entire price for additional properties
Example
Rachel — £250,000 BTL flat in Manchester
Rachel buys a two-bedroom flat in Manchester for £250,000. She expects £950/month rent and takes a 75% LTV mortgage at 5.2% over 25 years.
Rachel's flat is cash-flow negative before tax, and the ICR is below the typical 125% lender requirement. She may need to increase the deposit or find a higher-yielding property. She shared the calculator with her mortgage broker to discuss options: "The Section 24 tab showed me the true cost of being a higher-rate taxpayer — I'm now looking at a limited company structure."