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Rental income tax calculator

Landlord earning rental income from a tenant in your home or a buy-to-let property? Quickly calculate how much you can expect to pay in rental income tax. View all our calculators
Where do you get this rental income from?
In which year did you earn this income?
Monthly rental income
Monthly mortgage interest
Other monthly rental expenses
Annual salary
(or pension, self-employment, etc.)
After-tax rental income
After-tax rental income
After-tax rental income

You earned £18,000 from rent.

You also paid £0 in mortgage interest, and no longer can claim any of it.
You can claim £3,600 as other rental expenses.

Your taxable rental income will be: £14,400.

£12,000 will be taxed at 20%: £2,400 in rental income tax.

£2,400 will be taxed at 40%: £960 in rental income tax.

Rental income tax you have to pay

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How your rental income tax is calculated

Your total rental income tax that you have to pay to HMRC depends on three things:

  • How much you earned from rent
  • If you also live there or not
  • How much you earned from other income sources (salary, self-employment, etc., but not capital gains)

In your case you earned £18,000 from renting out a buy to let property, on top of £38,000 from other sources.

Rental income tax breakdown

Your rental earnings are £18,000

You can claim £3,600 as rental expenses.

As a result, your taxable rental income will be: £14,400.

The first £12,000 will be taxed at 20%: £2,400 in rental income tax.

The next £2,400 will be taxed at 40%: £960 in rental income tax.

Common questions

You’re not alone. If you’ve got a question about tax we’ve probably heard it before and have an answer, or we can walk you through what to do.

More self-service guides and FAQs

Anything can be claimed as long as it relates directly to renting or maintaining the property:

  • agent fees, accountant fees, legal fees
  • rent (if you’re subletting), cleaning
  • most utilities

Three important things to keep in mind:

  • if your expenses are less than £1,000, don’t worry about receipts – just claim this flat £1,000 property allowance instead. Couples each get £1,000, so it’s double if you’re renting out a jointly owned property
  • if you made a rental loss last year (for example, couldn’t find a tenant), you can also claim it this year. It’s called “carrying forward a loss”
  • for anything that improves the value of the property (adding a patio, etc.), you can only claim them against your capital gains tax bill when you sell your property

Read more in our guide to allowable property expenses here

As long as you also live there, you can actually claim the first £7,500 as a flat tax relief.

It’s called the Rent-a-Room Scheme, and it’s one of the best tax reliefs landlords can get.

If you earn under £7,500 from rent, you don’t even need to declare it or submit a Self Assessment tax return.

Again, the only condition is that you also live at the property.


Read more about the Rent-a-Room Scheme here.

There are two situations:

1. If you also live at the property, you can claim the first £7,500 as a flat tax relief as part of the Rent a Room Scheme. If you earn less than that through Airbnb-ing your own home, you shouldn’t need to declare it.

2. If it’s a second property or a buy-to-let and you earn over £1,000 from rental income (including Airbnb), you have to declare it and pay tax on it.

Read more in our guide for Airbnb hosts.

First, if you’re renting out a buy-to-let, you can only claim mortgage interest – not the full mortgage payments.

Second, starting in 2020 you will get a tax credit worth 20% of your finance costs instead.

What does this mean for you?

  • if you’re a basic rate taxpayer (meaning you earn under £50,000), you don’t need to worry
  • if you’re a higher rate taxpayer, it will mean a slightly higher tax bill – it all depends on how many buy-to-let properties you have. However, for most people it won’t be a huge change.

You can read more about the mortgage interest relief changes here

The UK tax year for individuals starts April 6th and ends April 5th of the following year. From then, you have until January 31st to complete your online tax return for the previous tax year.

More on tax dates can be found here

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