Landlord Tax Calculator
Calculate income tax on your UK rental property for 2025/26. See how Section 24 affects your mortgage interest relief, compare Rent-a-Room vs buy-to-let, and find your effective tax rate on rental profit.
Try another scenario
How to Use This Calculator
Rental Profit Tax tab
Enter your annual rental income, allowable expenses (letting agent fees, insurance, repairs, accountancy), mortgage interest, and your other income (salary or self-employment). The calculator works out your rental profit, applies income tax at your marginal rate, then deducts the Section 24 tax credit (20% of mortgage interest) to give your net tax on rental income and effective tax rate.
Section 24 Impact tab
Compare the old rules (mortgage interest fully deductible from rental profit) with the current rules (Section 24 — no deduction, only a 20% tax credit). See exactly how much more tax you pay under Section 24. This tab is most revealing for higher-rate and additional-rate taxpayers, who lose the most from the restriction.
Rent-a-Room vs BTL tab
Compare Rent-a-Room Relief (renting a room in your own home, tax-free up to £7,500/year) with a buy-to-let property. Enter monthly income for each, plus BTL expenses and mortgage interest. See the net income comparison after tax to decide which route makes more financial sense.
Share your result
Every input is encoded in the URL. Click Share to send your exact scenario to a partner, accountant, or save it for later.
The Formula
UK landlord tax under Section 24 works differently from most income taxes:
(Mortgage interest is NOT deducted from profit)
Total Taxable Income = Salary + Rental Profit
Income Tax = Tax on Total Income − Tax on Salary Alone
Section 24 Tax Credit = Mortgage Interest × 20%
Net Tax on Rental = Income Tax on Rental − Section 24 Credit
Effective Rate = Net Tax / Rental Profit
Rent-a-Room: First £7,500 is completely tax-free
Property Allowance: First £1,000 is tax-free (alternative to expenses)
The key difference from the old rules: before Section 24, a higher-rate taxpayer with £5,000 mortgage interest saved £2,000 in tax (40% × £5,000). Now they only get a £1,000 credit (20% × £5,000) — costing them £1,000/year extra.
For basic-rate taxpayers, the difference is zero — 20% deduction vs 20% credit produces the same result.
Example
David — Higher Rate Taxpayer, BTL Landlord
David earns £50,000 salary (higher rate taxpayer). He owns a buy-to-let flat that earns £12,000/year in rent. His mortgage interest is £5,000/year and he has £3,000 in allowable expenses (letting agent, insurance, minor repairs).
Rental Profit Tax tab
David's £9,000 rental profit is taxed at his marginal rate of 40%, giving £3,600. The Section 24 credit reduces this by £1,000, leaving £2,600 net tax. His effective rate on rental income is 28.9%.
Section 24 Impact tab
Under the old rules, David would have deducted £5,000 mortgage interest from his rental profit, giving a taxable profit of just £4,000. His tax would have been £1,600 (40% of £4,000). Under Section 24, he pays £2,600. Section 24 costs David an extra £1,000/year.