Landlord tax calculator: 2026/27 vs 2027/28
Enter four numbers to see the income tax on your rental profit this year and under the new property rates from 6 April 2027.
Key facts
- From 6 April 2027 rental profit is taxed at 24%, 44% or 49%, four points above the rates on wages.
- The Section 24 credit on mortgage interest rises from 20% to 24%.
- Your Personal Allowance is used against wages, pension and trading profit before rental profit.
- The bands don't change: £12,570, £50,270 and £125,140, frozen until April 2031.
Your full breakdown
How the calculator works
Rental profit is rent minus allowable expenses. Under Section 24, mortgage interest isn't deducted. It earns a tax credit instead. The calculator then:
- Works out your Personal Allowance, which is reduced by £1 for every £2 of income above £100,000.
- Uses the allowance against your other income first, then against rental profit if any is left. This is the rule from 2027/28. In 2026/27 the order makes no difference because the rates are the same.
- Places rental profit on top of your other income in the bands. It is taxed at 20/40/45% in 2026/27 and 24/44/49% in 2027/28.
- Takes off the finance cost credit (20%, then 24%) on the lowest of your finance costs, your rental profit and your taxable income.
Tax on rental profit is your total income tax minus the tax on your other income alone. That shows the true cost of letting at your income level.
Worked example
Salary £60,000, rental profit £20,000 and mortgage interest £9,000. All the rental profit falls in the higher band.
| 2026/27 | 2027/28 | |
|---|---|---|
| Tax on £20,000 profit | £8,000 (40%) | £8,800 (44%) |
| Finance cost credit on £9,000 | −£1,800 (20%) | −£2,160 (24%) |
| Tax on rental profit | £6,200 | £6,640 |
The bill rises by £440 a year. The rate rise costs £800 and the higher credit gives back £360. Read our guide to the 2027 rates for more examples.
What this calculator assumes
Individual landlord. UK residential property. Taxpayer in England, Wales or Northern Ireland. No savings or dividend income, no pension contributions or Gift Aid, no losses brought forward. The 2027/28 figures reflect the Budget of 28 October 2026 and depend on the Finance Bill becoming law.
Frequently asked questions
What are the property income tax rates from April 2027?
From 6 April 2027, rental profit of individual landlords in England, Wales and Northern Ireland is taxed at 24% (basic), 44% (higher) and 49% (additional). The 2025 Budget had set 22%, 42% and 47%. The Budget of 28 October 2026 added two more points.
Does Section 24 relief go up too?
Yes. The finance cost credit follows the property basic rate, so it rises from 20% to 24% in 2027/28. Higher-rate landlords pay 44% on profit and get 24% back on interest.
Do the tax bands change?
No. The Personal Allowance stays at £12,570, the higher rate starts at £50,270 and the additional rate at £125,140. All are frozen until April 2031.
How is the Personal Allowance applied from 2027/28?
It is set against employment, pension and trading income first. Only what's left covers rental profit. If your other income is over £12,570, all your rental profit is taxed at the property rates.
Does this work for Scotland?
No. Scottish taxpayers have their own bands and rates. This calculator covers England, Wales and Northern Ireland.
Sources
- GOV.UK: Income Tax rates and allowances, current and past
- GOV.UK: Tax relief for residential landlords, how it's worked out
- GOV.UK: Work out your rental income when you let property
- HM Treasury: Budget documents, 28 October 2026
Sources last checked 9 November 2026. See all our sources and how we keep pages up to date.