£2,511
United Kingdom
Landlord tax 2027 calculator — property income rates 22%, 42%, 47%
From April 2027 rent is taxed at 22/42/47%. Here is your bill, both years, side by side.
From 6 April 2027, rental profit gets its own income tax rates: 22% in the basic band, 42% in the higher band and 47% in the additional band — two points more than the rates on salary. Finance cost relief rises to 22% at the same time. This calculator runs the same property and the same income through both tax years so you can see what the change costs you.
+£23 a year of extra tax from April 2027
Same property, same income: £2,511 of tax in 2026/27 becomes £2,534 in 2027/28.
£2,534
-£23
| 2026/27 | 2027/28 | |
|---|---|---|
| Taxable property profit (interest not deducted) | £11,662 | £11,662 |
| Income tax on that profit | £4,611 | £4,844 |
| Finance cost relief at 20% | -£2,100 | -£2,310 |
| Child Benefit charge caused | £0 | £0 |
| Personal allowance lost | £0 | £0 |
| Interest carried forward | £0 | £0 |
| Tax caused by the property | £2,511 | £2,534 |
Worked example
With a £50,000 salary and the default property, the rental adds £2,511 to the 2026/27 tax bill and £2,534 in 2027/28 — +£23 a year. The profit before interest (£11,662) now pays 42% instead of 40% in the higher band, while the £10,500 of mortgage interest earns relief at 22% instead of 20%.
Extra tax from 2027/28 at a glance
Extra tax per year on rental profit (before interest, with no mortgage) for a landlord in England, Wales or Northern Ireland, generated by the same engine as the calculator:
| Salary | £5,000 profit | £15,000 profit | £30,000 profit |
|---|---|---|---|
| £30,000 | +£100 | +£300 | +£600 |
| £50,000 | +£100 | +£300 | +£600 |
| £80,000 | +£100 | +£300 | +£600 |
| £110,000 | +£100 | +£300 | +£600 |
Mortgaged landlords pay slightly less extra tax than the table shows, because the credit on interest rises from 20% to 22%.
What the law says
Section 6 of the Finance Act 2026 creates the property basic, higher and additional rates and makes property income the top slice of your income, above salary and pensions. It also requires the personal allowance to be set against other income first. Section 7 sets the 2027/28 rates at 22%, 42% and 47%, and Schedule 1, paragraph 40 moves finance cost relief to the property basic rate. HM Treasury's policy paper notes that the new rates do not apply in Scotland, which sets its own.
The basic-rate band (£37,700) and personal allowance (£12,570) are frozen until 2030/31 by section 10, so rising rents push more profit into higher bands over time.
What this calculator does not include
- Scotland and Wales: the Scottish Parliament and the Senedd can set their own property rates.
- Savings and dividend income, which sit above property income in the new ordering.
- Limited company landlords, who are unaffected by these rates.
Questions landlords ask
When do the new property income tax rates start?
For the 2027/28 tax year, which starts on 6 April 2027 (Finance Act 2026, section 6(8)).
Do the 22%, 42% and 47% rates apply to limited companies?
No. They are income tax rates for individuals. Companies pay corporation tax on rental profits.
Does the mortgage interest credit go up too?
Yes — finance cost relief is given at the property basic rate, 22% from 2027/28.
Why does the personal allowance ordering matter?
Your allowance is now used against salary or pension first, so less of it shelters rental profit. For most landlords with a salary above the allowance this makes no difference; it matters for those with low other income.
Tax rules: UK registry v1.0.0, last reviewed 2026-09-30. Figures in the text use the default inputs above. Sources and method.