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Compare illustrative UK individual residential landlord Income Tax scenarios for 2025/26 or 2026/27. Results are not a Self Assessment calculation.
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Excludes savings and dividends.
Enter the unused residential finance-cost amount from an earlier return.
The share link includes your rental and tax assumptions in an unencrypted URL.
Compare the modelled Income Tax effect for each expense basis; chart rounded to whole pounds.
Exact estimated additional tax by expense basis (GBP; exact to 2 decimal places)
| Metric | Actual expenses (selected) | Property allowance |
|---|---|---|
| Estimated additional tax | £6,066.00 | £9,146.00 |
Rental income less entered cash expenses, mortgage interest and modelled additional Income Tax.
Exact estimated post-tax cashflow by expense basis (GBP; exact to 2 decimal places)
| Metric | Actual expenses (selected) | Property allowance |
|---|---|---|
| Estimated post-tax cashflow | £5,234.00 | £2,154.00 |
The chart shows model-returned values; it does not mean mortgage interest is deductible from rental profit.
Exact taxable rental profit and Section 24 credit by expense basis (GBP; exact to 2 decimal places)
| Metric | Actual expenses (selected) | Property allowance |
|---|---|---|
| Taxable rental profit before finance costs | £19,300.00 | £23,000.00 |
| Qualifying finance costs considered | £8,000.00 | Not modelled for this election |
| Section 24 eligible cost base | £8,000.00 | £0.00 |
| Section 24 tax reducer | £1,600.00 | £0.00 |
| Qualifying costs carried forward | £0.00 | Not modelled for this election |
Since April 2020, individual landlords generally cannot deduct residential finance costs from rental income before calculating tax. Instead, a basic-rate tax reduction may apply under the finance-cost rules.
Impact: The restriction can affect taxable-income and tax-band calculations, but the result depends on the full property and personal-income position.
This estimate treats the entries as one individual UK residential property business. It does not verify brought-forward finance costs or other property-business losses; use figures confirmed from your records or HMRC.
Potentially allowable: Repairs, maintenance, letting-agent fees and insurance may be deductible when the relevant wholly-and-exclusively and property-business rules are met.
Capital: Property improvements (e.g., extensions) are not deductible from income but can offset Capital Gains Tax (CGT) when you sell.
The £1,000 Property Allowance may apply where the scheme conditions are met. It is not a general exemption and choosing it instead of actual expenses can produce a different result; confirm the current HMRC rules for your property business.
Purchasing additional residential properties (including BTL) is subject to the applicable Stamp Duty Land Tax (SDLT) surcharge and current rates for 2026/27; the exact liability depends on the property and transaction.
A property company may handle finance costs differently from an individual landlord, but the outcome depends on the company, accounting period, financing and Corporation Tax rules. It is not an automatic 100% deduction or a universal saving.
Compare LTD vs IndividualQualifying Rent-a-Room income from your main home can be exempt up to £7,500 gross per year, subject to the scheme conditions. It is not a general rental allowance and is not automatically suitable for every lodger arrangement.
A genuine change in beneficial ownership and a valid HMRC Form 17 may affect how jointly owned property income is allocated. The declaration, ownership evidence and tax outcome must be checked; it is not an automatic tax-reduction route.
Marriage Allowance CheckPension contributions may affect taxable income and marginal tax, subject to the contribution method, relevant earnings, Annual Allowance and personal circumstances. They do not automatically reclaim a Personal Allowance or avoid higher-rate tax.
Calculate Pension ReliefCompare an illustrative individual residential landlord Income Tax estimate using entered rental income, non-savings/non-dividend income, finance costs and expense assumptions for the selected UK tax year and Income Tax region.
Compare the entered allowable-expense basis with the £1,000 property allowance and review estimated additional Income Tax, post-tax rental cashflow and the Section 24 relief limits returned by the model. Choose rUK or Scotland for Income Tax bands. Enter any verified residential finance costs brought forward from an earlier return. This is not a Self Assessment calculation: it does not validate expense or relief eligibility, calculate brought-forward property losses, determine company or furnished-holiday-let treatment, or verify a prior-year finance-cost balance. Confirm the full rules with HMRC before acting.
Your inputs are sent to FinanceTool’s UK tax service for the estimate. When you edit or share a comparison, its input values are included in the page URL, which is not encrypted. Inputs are saved in this browser only when functional storage consent is enabled; disabling that consent removes the saved inputs.
These HMRC and GOV.UK sources explain the rules behind this simplified rental-income illustration.