Rental Income Tax Calculator 2026/27
Calculate tax on your UK rental income including Section 24 mortgage interest restrictions
Insurance, repairs, agent fees, etc.
Section 24 of the Finance Act 2015 removed the ability for individual landlords to deduct mortgage interest from rental income. Instead, you receive a 20% tax credit on mortgage interest payments. This particularly affects higher and additional rate taxpayers.
Allowable Expenses for Landlords
- Letting agent fees and management costs
- Buildings and contents insurance
- Repairs and maintenance (not improvements)
- Ground rent and service charges
- Accountancy fees
- Legal fees for lets under 1 year
Author: Waqas Sagar, UK Tax Specialist | Reviewed: May 2025 | Source: HMRC Property Income Manual
Do I need to pay tax on rental income?
Yes, rental income is taxable. However, you can use the £1,000 property allowance if your gross rental income is low, or deduct actual expenses if they exceed £1,000.
Can I still deduct mortgage interest?
No, under Section 24 you cannot deduct mortgage interest. Instead, you get a 20% tax credit on interest payments. This affects higher rate taxpayers more significantly.
Should I put my rental property in a limited company?
Companies can still deduct mortgage interest fully. However, transferring existing properties triggers SDLT and CGT. New purchases through a company may be more tax-efficient.