UK Landlord Tax 2027 Calculator
From 6 April 2027, rental profit is taxed at new property rates of 24%, 44% and 49%, up from 20%, 40% and 45%. Budget 2026 raised them two points above the 22/42/47 announced a year earlier, so many tools are already out of date. Enter your figures to see what you pay on your rental profit this year and next, and the difference.
For landlords taxed in England and Northern Ireland, letting property they own personally. Scotland and Wales set their own rates later this year.
Read the explainer: Landlord tax from April 2027, with three landlords worked through.
Work out the change in your tax
What changes in April 2027
| Band (taxable income) | 2026/27 | 2027/28 |
|---|---|---|
| Basic: £1 to £37,700 | 20% | 24% |
| Higher: £37,701 to £125,140 | 40% | 44% |
| Additional: over £125,140 | 45% | 49% |
| Mortgage interest credit | 20% | 24% (assumed) |
Two other things change. Property income is taxed after your salary, pension or trading income and before savings and dividends, and your personal allowance is used against that other income first. For most landlords with a job or pension this makes no difference to the total, because the rent already sat on top. It matters when your other income is below £12,570.
Your salary, pension and self-employment income stay at 20%, 40% and 45%. Only the rental slice pays the higher rates, which is why the increase is four points of your rental profit, less the extra four points of mortgage interest credit.
Method & sources
This calculator is educational, not advice. It estimates income tax on rental profit from the numbers you enter; it is not tax advice. Check your own position with HMRC or a tax adviser.
- Formula
Personal allowance = £12,570, less £1 for every £2 of income (other income plus rental profit before mortgage interest) above £100,000.
The allowance is used against other income first; anything left is used against rental profit.
Other income is taxed first at 20/40/45 across the bands (basic up to £37,700 of taxable income, higher up to £125,140, additional above). Rental profit is taxed in the band space left: at 20/40/45 in 2026/27, at 24/44/49 in 2027/28.
Mortgage interest credit = credit rate x the lowest of: finance costs, rental profit, and total income above the personal allowance. It cannot take your tax below zero. Credit rate 20% in 2026/27; 24% (editable) in 2027/28.
Tax on your rental profit = total income tax with the rental profit, less total income tax on your other income alone. So it includes any personal allowance the rent takes away.
- Rounding
- Worked to the penny; every figure shown rounded to the nearest pound.
- Inputs used
- Where you pay income tax (England or Northern Ireland only for now)
- Other income before tax: salary, pension or self-employment profit
- Rental profit before mortgage interest
- Mortgage interest and other finance costs
- Mortgage interest credit rate for 2027/28 (default 24%)
- What this does not account for
- Savings interest and dividends, which are taxed after property income and also change rates in 2027/28
- Pension contributions and Gift Aid, which extend your bands and reduce adjusted net income
- Finance costs carried forward from earlier years (the page shows any amount not relieved this year)
- Furnished holiday lets, property held in a company, and jointly owned property split between owners
- National Insurance, the High Income Child Benefit Charge and the Marriage Allowance
- Jurisdiction
- United Kingdom income tax for taxpayers in England and Northern Ireland. Scotland and Wales set their own property income rates (Wales on 17 November 2026, Scotland on 3 December 2026).
- Source
- HM Treasury, Budget 2026 overview of tax legislation and rates, Annex A: bands, main rates, property rates (24/44/49 for 2027/28; property income at the main rates in 2026/27), personal allowance and the £100,000 income limit.
- ICAEW, Preparing for 2027/28 changes to the calculation of income tax: property income taxed after other income and before savings and dividends; allowances against other income first; finance cost relief given at the property basic rate.
- ICAEW, Budget: tax rates on property and savings income increased: confirms 24%, 44% and 49% from April 2027.
- Effective date
- 2026/27 (6 April 2026 to 5 April 2027) and 2027/28 (from 6 April 2027), as announced at Budget 2026 on 28 October 2026. The 2027/28 rates take effect through the Finance Bill.
- Version
- 1.0
- Last substantive review
- 2026-11-03
- Limitations
- The 2027/28 mortgage interest credit rate is an assumption. The legislation gives the relief at the property basic rate, which ICAEW read as 22% before Budget 2026 raised that rate to 24%. HMRC had not restated the credit rate after the Budget when this page was built, so the field defaults to 24% and can be changed.
- Assumes all your other income is employment, pension or trading income. If some of it is savings or dividends, the real figure differs.
Reference cases
Reference case 1: basic-rate landlord
- Other income: £20,000
- Rental profit: £10,000
- Mortgage interest: £3,000
Result: All £10,000 sits in the basic band. 2026/27: £2,000 less a £600 credit = £1,400. 2027/28: £2,400 less a £720 credit = £1,680. Increase £280.
Reference case 2: higher-rate landlord
- Other income: £60,000
- Rental profit: £20,000
- Mortgage interest: £8,000
Result: All £20,000 sits in the higher band. 2026/27: £8,000 less £1,600 = £6,400. 2027/28: £8,800 less £1,920 = £6,880. Increase £480.
Reference case 3: rent crosses into the higher band
- Other income: £30,000
- Rental profit: £25,000
- Mortgage interest: £5,000
Result: Taxable other income £17,430 leaves £20,270 of basic band; the other £4,730 of rent is higher rate. 2026/27: £4,054 + £1,892 - £1,000 = £4,946. 2027/28: £4,864.80 + £2,081.20 - £1,200 = £5,746. Increase £800.
Reference case 4: rent takes income over £100,000
- Other income: £90,000
- Rental profit: £30,000
- Mortgage interest: £10,000
Result: Income of £120,000 cuts the allowance by £10,000 to £2,570, adding £4,000 of tax on the salary. 2026/27: £4,000 + £12,000 - £2,000 = £14,000. 2027/28: £4,000 + £13,200 - £2,400 = £14,800. Increase £800.
Reference case 5: no other income, large mortgage
- Other income: £0
- Rental profit: £20,000
- Mortgage interest: £15,000
Result: The allowance covers £12,570 of rent, leaving £7,430 taxable. The credit is limited to income above the allowance (£7,430), so it wipes out the tax in both years: £0 and £0. £7,570 of interest is carried forward.
Change log
| Date | Change |
|---|---|
| 2026-11-03 | Calculator built after Budget 2026 (T-1373). Rates checked against HM Treasury's Budget 2026 Annex A the same day. |
Frequently Asked Questions
From 6 April 2027 property income in England and Northern Ireland is taxed at 24% (basic rate), 44% (higher rate) and 49% (additional rate), according to the Budget 2026 rates annex published by HM Treasury. In 2026/27 it is taxed at the main rates of 20%, 40% and 45%. The bands and the £12,570 personal allowance do not change.
Those were the rates announced at Budget 2025. Budget 2026, on 28 October 2026, added a further two points, so the rates for 2027/28 are now 24%, 44% and 49%. Many calculators and articles still use the older figures.
Mortgage interest on a residential let is still not deducted from rental profit. Instead you get a tax credit on the lowest of your finance costs, your property profit and your income above the personal allowance. In 2026/27 the credit is 20%. From 2027/28 it is given at the property basic rate, which this calculator assumes is 24%; you can change that figure.
Not yet. Scotland and Wales set their own property income rates. Wales is due to set them on 17 November 2026 and Scotland on 3 December 2026. The calculator will be updated once they are published.
No. Everything is worked out in your browser and nothing is sent anywhere or saved.