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Landlord tax 2027 calculator

From 6 April 2027, rental profit is set to be taxed at its own rates: 24%, 44% and 49%. Enter your rent, costs and mortgage interest to see this year's bill next to next year's.

Rates checked 3 November 2026 Checked by Daniil Shumko, editor

£
£
Letting fees, repairs, insurance, service charges. Not mortgage interest.
£
Interest only, not the capital part of repayments.
Your income tax band

Extra tax a year from April 2027

£240

That's £20 a month more, if the announced rates become law.

Working2026-272027-28 (announced)
Tax on your rental profit£3,600£3,840

A simple illustration: it assumes all your rental profit sits in one band, ignores your personal allowance and other income, and doesn't apply the limits on the interest credit. England, Wales and Northern Ireland. Scotland sets its own rates.

Announced, not yet law. The 24%, 44% and 49% rates come from the 28 October 2026 Budget and still need to pass in Finance Bill 2026-27. We'll update this calculator when they do.

How the calculation works

Landlords can't deduct mortgage interest from rental profit. Instead, you pay tax on the profit before interest at your band's property rate, then take off a credit worth the interest multiplied by the property basic rate. From April 2027 both numbers move: the rate on your profit goes up four points, and the credit goes up four points too.

Worked example

A higher-rate landlord with £12,000 profit before interest and £6,000 of mortgage interest:

2026-272027-28
Tax on £12,000 profit£4,800 (40%)£5,280 (44%)
Interest credit on £6,000−£1,200 (20%)−£1,440 (24%)
Tax to pay£3,600£3,840

The bill rises by £240 a year. With no mortgage, the same landlord would pay £480 more.

Common questions

What are the new landlord tax rates from April 2027?

The Budget on 28 October 2026 set the property income rates for 2027-28 at 24% (basic), 44% (higher) and 49% (additional), up from 20%, 40% and 45%. They still have to pass in Finance Bill 2026-27, so they are announced, not yet law.

Didn't the rates go up to 22%, 42% and 47%?

That was the plan announced in November 2025, and Finance Act 2026 still holds those rates. The October 2026 Budget added two more points to each. Guides quoting 22%, 42% and 47% are out of date.

Does mortgage interest relief change too?

Mortgage interest still isn't deducted from rental profit. You get a tax credit at the property basic rate instead, which is due to rise from 20% to 24% along with the basic rate.

How much more will I pay?

If all your rental profit stays in one band, the rise is roughly 4% of your profit before interest, less 4% of your interest. On £12,000 profit with £6,000 interest, that's £240 more a year at every band.

Does this apply in Scotland?

The new property rates are set to apply to individuals in England, Wales and Northern Ireland. The Scottish and Welsh governments can set their own property income rates, so check their decisions separately.

Sources

  1. HMRC: Income Tax, changes to tax rates for property and savings income
  2. GOV.UK: Budget 2026
  3. GOV.UK: Budget 2026, Annex A rates and allowances

This calculator gives a general figure, not tax, legal or financial advice. Where the government publishes worked examples, we test it against them. Found a problem? Tell us.