Example result based on the prefilled values.
Annual Cash Flow After Estimated Tax
£5,280.00
Monthly Cash Flow After Estimated Tax
£440.00
Annual Cash Flow Before Tax
£6,600.00
Estimated Property-Income Tax Effect
£1,320.00
Finance-Cost Tax Reduction
£1,600.00
Taxable Property Profit
£14,600.00
Cash-on-Cash Return
8.80%
Rent-to-Interest Cover
2.14x
Continue your plan
Useful next calculations
Rates & sources2026/27
2026/27 individual-landlord illustration. Residential finance costs are excluded from taxable property profit and may receive a 20% tax reduction subject to HMRC limits.
Source: HMRC — residential landlord finance costs — source checked for 2026/27.
When to use this calculator
- Before buying, renting, refinancing, or reviewing a property investment.
- When you want to compare cash flow, yield, growth, and ownership costs side by side.
- When you need a fast estimate before speaking to an agent, lender, or adviser.
- When you are assessing whether a rental property still makes financial sense after a mortgage rate change.
- When you want to compare the total cost of renting against owning over a five- or ten-year horizon.
A realistic UK planning example
Use these sample inputs as a quick scenario test, then change one variable at a time to compare outcomes.
Your share of annual rent before voids (£)
£1,400
Void or non-payment allowance (%)
5
Allowable non-finance expenses or deduction used (£)
2500
Your share of annual residential finance costs (£)
£200,000
After entering these figures, review annual cash flow after estimated tax, monthly cash flow after estimated tax and annual cash flow before tax together rather than in isolation — each metric tells a different part of the story. Then rerun the tool with one input adjusted to see which variable has the biggest effect on all three outputs before you settle on a plan.
How to read your results
Annual Cash Flow After Estimated Tax
Review this figure alongside your gross income so you can understand the true cost of deductions and plan around any thresholds before the tax year closes. If the figure looks higher than expected, check whether any pension or gift-aid contributions could reduce your taxable income.
Monthly Cash Flow After Estimated Tax
Review this figure alongside your gross income so you can understand the true cost of deductions and plan around any thresholds before the tax year closes. If the figure looks higher than expected, check whether any pension or gift-aid contributions could reduce your taxable income.
Annual Cash Flow Before Tax
Review this figure alongside your gross income so you can understand the true cost of deductions and plan around any thresholds before the tax year closes. If the figure looks higher than expected, check whether any pension or gift-aid contributions could reduce your taxable income.
Estimated Property-Income Tax Effect
Review this figure alongside your gross income so you can understand the true cost of deductions and plan around any thresholds before the tax year closes. If the figure looks higher than expected, check whether any pension or gift-aid contributions could reduce your taxable income.
Finance-Cost Tax Reduction
Review this figure alongside your gross income so you can understand the true cost of deductions and plan around any thresholds before the tax year closes. If the figure looks higher than expected, check whether any pension or gift-aid contributions could reduce your taxable income.
Taxable Property Profit
Review this figure alongside your gross income so you can understand the true cost of deductions and plan around any thresholds before the tax year closes. If the figure looks higher than expected, check whether any pension or gift-aid contributions could reduce your taxable income.
Cash-on-Cash Return
Use this to compare scenarios over different time horizons and judge whether the projected outcome clears your minimum required target. Remember that real-world returns fluctuate, so also check the result under a more conservative growth assumption.
Rent-to-Interest Cover
Use this metric to compare scenarios side by side and understand how changes in the key inputs drive the final outcome. If the figure surprises you, isolate one variable at a time and rerun the calculation to identify which assumption is responsible.
Method & assumptionsAuthoritative sources
This calculator combines your share of rent, a void assumption, allowable non-finance expenses, residential finance costs and mortgage capital payments to estimate cash flow for an individually owned UK residential property. It then compares the 2026/27 Income Tax estimate with and without the taxable property profit.
Residential mortgage interest is not deducted from the property profit in this model. Instead, the finance-cost tax reduction is 20% of the lowest of available finance costs, taxable property profit and the simplified adjusted-total-income amount, following HMRC's restriction for individual residential landlords. Mortgage capital reduces cash flow but not taxable profit.
This is not suitable for limited companies, furnished holiday letting periods governed by different rules, commercial property, trusts or a complete multi-property tax return. Savings, dividends, detailed allowance ordering and some carried-forward calculations are not modelled. Confirm allowable expenses, losses and finance costs using HMRC records or professional advice.
Common mistakes
- !Comparing rent and ownership costs without including taxes, fees, and maintenance.
- !Using purchase price alone without testing the impact of financing or vacancy assumptions.
- !Relying on yield or growth in isolation instead of reviewing the full property case.
- !Forgetting Stamp Duty Land Tax (or its Scottish and Welsh equivalents), which can add thousands to the true cost of purchase.
- !Using optimistic rental growth figures without also testing a flat or declining rent scenario to check downside resilience.
What to do next
- Run a second scenario with a higher rate or lower rental yield to check downside resilience.
- Compare the result with a buy-versus-rent or stamp duty calculator before making an offer.
- Use the related guides below to understand agent fees, legal costs, and ongoing maintenance budgets.
- If you are assessing a buy-to-let, check the gross yield against the net yield after mortgage interest, voids, and management fees.
- Note down the key figures from this scenario to share with your solicitor or mortgage broker so they are working from the same assumptions.
Frequently asked
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