Buy-to-let calculator for 2026/27
See the cash needed to buy, the income left after costs and how a change in assumptions affects your results.
Scope and assumptions
New residential purchases in England or Northern Ireland. UK-resident owners, non-Scottish Income Tax rates and interest-only finance.
This is a planning illustration, not a mortgage affordability check.
After mortgage interest, running costs and time between tenants.
Where the rent goes
Monthly averageHow to use this buy-to-let calculator
Start with the purchase price, expected rent, deposit and interest rate. Replace the example costs and empty weeks with your own assumptions. Use Stress test to explore a tougher year, Ownership to compare the modelled tax positions, and Compare to review a saved scenario. Download report uses your current figures and selected saved comparison.
Rental yield and cash flow measure different things
Gross rental yield is twelve months of advertised rent divided by the purchase price, expressed as a percentage. It excludes empty periods and costs.
Net operating yield deducts vacancy and running costs before dividing by the purchase price. In this tool it excludes mortgage interest, tax and purchase costs.
Monthly cash flow deducts vacancy, running costs and mortgage interest from annual rent, then divides by twelve. It is an average before tax, not a monthly payment schedule.
Cash-on-cash return divides annual cash flow before tax by the initial cash needed, including the deposit, SDLT, buying fees and initial works. That initial cash does not include an emergency reserve. The Ownership view shows the separate modelled tax comparison.
Test the assumptions before comparing ownership
A higher mortgage rate, time without a tenant or an unexpected repair can change the result. These scenarios show the effect of the assumptions you choose; they are not forecasts or lender stress tests.
Company cash retained after tax is not the same as money available for personal spending. The Ownership view separates keeping profits in the company from taking them as dividends and includes the company costs you enter. It does not assess transferring an existing property into a company.
Read about personal and company ownership · Calculate tax on an ongoing letting
Method and official sources
This illustration covers a new residential purchase in England or Northern Ireland, a full year of ordinary letting to unconnected tenants, and a UK-resident owner using non-Scottish Income Tax rates. Finance is interest-only.
The company comparison assumes one new UK-resident property company, one shareholder, a twelve-month accounting period, no associated companies and eligibility for the modelled company tax and property-rental reliefs. Relief eligibility and filing obligations need checking.
It does not model repayment mortgages, joint ownership, non-resident owners, Scottish taxpayer rates, existing-property transfers, capital growth or tax on a future sale. The full assumptions also explain exclusions for other income, reliefs and carried-forward amounts.
Full calculation assumptions
Cash flow
Rent collected = monthly rent × 12 × (1 − empty weeks ÷ 52). Management fees apply to collected rent. Annual cash flow deducts management, repairs, other annual costs and mortgage interest. Monthly figures are annual averages; they are not a payment schedule.
Money needed to buy
Deposit + SDLT + buying fees + initial works. Mortgage finance fees and a cash reserve are excluded. Do not include mortgage arrangement or other finance fees in buying costs. Cash return is annual cash flow before tax divided by this initial cash. Gross yield uses 12 months of advertised rent, before any vacancy or expenses.
Stress tests
Interest increases are percentage points. Empty weeks are added to the base assumption, capped at 52 weeks. A repair is an additional one-off cost in the illustrated year. Break-even figures are before tax. Scenarios illustrate possibilities, not probabilities or forecasts.
Personal ownership
Other income means taxable employment, pension or self-employment income before the Personal Allowance; exclude this property. The model uses actual expense deductions, not the property allowance. Rental profit increases Income Tax, including any Personal Allowance taper. Residential mortgage interest receives the restricted 20% tax reduction, subject to the profit, adjusted-income and tax-liability limits. Unused finance costs and rental losses are shown where relevant, but future relief is not valued.
Company ownership
A new UK-resident company owns only this letting business, has a 12-month accounting period and no associated companies, other profits, losses or distributions received. It qualifies for the small profits rate and marginal relief. Corporation Tax is 19% up to £50,000 and 25% above £250,000, with marginal relief between. Company mortgage pricing, annual administration and setup costs are editable examples, not quotes.
Taking company money personally
The retained figure is cash inside the company after Corporation Tax. The personal figure assumes all positive after-tax profit is available as a lawful dividend to one shareholder in 2026/27. It includes dividend tax and any extra tax on other income caused by a reduced Personal Allowance. No other dividends, director salary, pension contribution or loan repayment are assumed. A negative figure is a funding shortfall, not a dividend.
Stamp duty and company reliefs
UK-resident buyers only. The personal purchase uses standard residential SDLT rates or the 5 percentage point additional-property surcharge you select. No first-time buyer relief is used for this investment purchase. The company always uses additional-property rates and is assumed to qualify for property-rental relief from the 17% corporate charge and any ATED charge. Relief claims and ATED filing obligations may still apply, particularly above £500,000. New-lease rent charges, linked purchases and mixed-use properties are outside the model.
What is outside this illustration
Existing-property transfers or incorporation; repayment mortgages; joint ownership; Scottish taxpayer rates; non-resident owners; savings and other dividend income; pension or Gift Aid relief; benefits, student loans and child-benefit charges; carried-forward balances; capital growth, sale costs and Capital Gains Tax. Initial works are treated as capital cash outlay, without an annual deduction. Annual costs are assumed to be allowable expenses actually incurred.
Dates and privacy
Income and dividend tax assumptions are for 6 April 2026 to 5 April 2027. This is a one-year illustration, not a forecast of future tax rules. Sources checked 13 September 2026. Calculations run in your browser. Saving is optional and stores figures only in this browser on this device. Downloaded reports contain the figures you choose to export.
Investor comparisons
Gross yield uses advertised annual rent / purchase price. Net operating yield uses rent after vacancy and running costs / purchase price, before finance and tax. Cash-on-cash return uses annual pre-tax cash flow / initial cash invested, including purchase costs. Operating interest cover is net operating income / interest; it is not lender underwriting. Each scenario has its own leverage and assumptions. A selected-measure leader is not an overall quality rating.
Using the result
Use this educational estimate to compare assumptions and prepare questions. It does not recommend a purchase or ownership structure, assess mortgage availability or replace advice based on your full circumstances. Have your accountant and conveyancer check the relevant assumptions before acting.
Tax assumptions: 2026/27. Sources checked 13 September 2026.
Questions about the calculator
Is this a buy-to-let mortgage affordability calculator?
No. It models cash flow using the borrowing assumptions you enter. It does not tell you how much a lender will offer or whether you qualify for a mortgage.
What is a good rental yield?
There is no single yield that makes a property suitable. Consider the cash left after costs, your borrowing, cash needed upfront and the effect of a tougher year. This tool does not assess local tenant demand, property condition or future value.
Does it cover Scotland and Wales?
The purchase model covers properties in England and Northern Ireland. It does not calculate Scottish or Welsh property-purchase taxes. Its personal tax comparison excludes Scottish taxpayer rates.
Can I save or download my figures?
You can save up to six scenarios in this browser and download a two-page report using your current figures. Saving is optional and local to this browser and device. No email is required.
This is an estimate for general information, not advice. Your position depends on your circumstances. Speak to us before acting.