Rental income tax calculator, 2026/27
This calculator is for a landlord who wants a quick view of how rental income affects their total personal tax bill for the year, combining it with salary or dividends to show the marginal rate it is taxed at.
The rental income tax calculator runs on the rates and thresholds HMRC has published for the 2026/27 tax year, so the figures you see reflect the position your company is actually filing on rather than a historic set of bands. Change any input and the result recalculates immediately, with no sign-up and nothing sent anywhere.
If you are a director of a UK limited company, use it as a first look before a decision rather than as the decision itself. Property income allowance of £1,000 for 2026/27, used automatically if it beats deducting actual expenses. Real company positions bring in other income, reliefs, group structures and prior year adjustments that a single page of inputs cannot see, which is why the workings are written out below under property & landlord. Read those, then check the numbers against your own accounts, and speak to us if anything looks materially different from what you expected.
Last reviewed 12 September 2026 for the 2026/27 tax year. Reviewed by Waqas Sagar, Member of ICAEW, Fellow of ACCA, Fellow of AAT.
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Result, 2026/27
Extra income tax from the rental
Taxable property income
After the better of expenses or the property allowanceMarginal rate applied to this income
Combined taxable income
Illustration only, figures are based on the rates you have selected and the information entered. Please check your own position with us before acting.
Estimates for the 2026/27 tax year using published GOV.UK rates. Switch between 2026/27 and 2025/26 above.
How this is calculated
Rental profit is added to your other income and taxed through the normal income tax bands for 2026/27: 20% basic rate, 40% higher rate above the higher rate threshold, and 45% additional rate above £125,140. There is no separate rate for property income, it simply stacks on top of salary, dividends or pension income you already have.
Everyone with property income can deduct a flat £1,000 property allowance instead of actual expenses if that produces a better result, which mainly helps landlords with very low costs. Where actual allowable expenses, letting agent fees, insurance, repairs and services provided, exceed £1,000, deducting them properly usually gives a lower taxable figure.
This calculator compares your rental income against both the property allowance and your stated expenses, taxes the resulting profit at your marginal rate, and reports the extra tax that letting has added to your bill this year.
Personally held property versus other structures
This calculator is aimed squarely at landlords who own property in their own name and are taxed on rental profit through Self Assessment. It deliberately does not restrict mortgage interest relief to a basic rate tax credit, because that restriction is covered separately under Section 24.
If you are comparing personal ownership against holding property through a limited company, remember that a company pays corporation tax on rental profit instead, and you would then face a further personal tax charge on extracting profit as salary or dividends.
Keeping records for Self Assessment
Landlords need to declare gross rent and allowable expenses on the UK property pages of their Self Assessment return each year, keeping receipts for repairs, agent statements, and mortgage interest certificates.
Where more than one rental property is owned, income and expenses are usually pooled together as a single UK property business, rather than reported property by property, which can make loss relief between properties more flexible.
What this means for your company
Treat the result as a planning figure for the 2026/27 tax year. If it changes what you were about to do, take a director's salary, a dividend, a large asset purchase or a filing decision, check it against your own accounts first. We can review the position with you and confirm the tax treatment before you commit.
Frequently asked questions
How is rental income taxed differently from employment income?
It is not a separate tax; rental profit is simply added to your other taxable income for the year and taxed at whatever marginal rate that combined total reaches, using the normal income tax bands.
Should I claim the £1,000 property allowance or deduct expenses?
Claim whichever gives the lower taxable figure. If your genuine allowable costs are below £1,000 the flat allowance usually wins; above that, deducting actual expenses is normally better.
Does this calculator restrict mortgage interest relief?
No. This tool looks at gross rental income taxed at your marginal rate. Mortgage interest relief restricted to a 20% tax credit is covered by the separate Section 24 mortgage interest relief calculator.
Do I need to register for Self Assessment for rental income?
Generally yes, once gross rental income exceeds £1,000 a year, you should register for Self Assessment and report the property income, even if the resulting tax bill is small.
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