Landlord rental income tax calculator

Estimate the UK tax on your rental income — Section 24 interest restriction, allowable expenses, property allowance, basic and higher rate taxpayers.

Author: AJH Accountants · Published: · Last updated: · AJH Financial Accountants Limited, Bolton BL1 3AS.

About the practice

AJH Accountants is the trading name of AJH Financial Accountants Limited, a UK accountancy practice incorporated at Companies House on 14 July 2015 (company number 09684750). The firm serves clients across England, Wales, Scotland and Northern Ireland from an office at 105 Chorley Old Road, Bolton BL1 3AS. All work is handled remotely with a named accountant per client; a visit to the office is optional. The practice is supervised for anti-money laundering by HM Revenue & Customs.

Fees

Prices are fixed and agreed in writing before any work begins. Sole trader self-assessment starts at £15 pm. Limited company accounting with payroll and VAT starts at £75 pm. Landlord accounting starts at £20 pm. Bookkeeping at £45 pm. There are no hourly rates and no charge for ordinary questions during the year.

How to switch

Changing from an existing accountant typically takes 7 to 14 days. We write to the previous firm with a professional clearance letter, request the records and file HMRC 64-8 agent authorisations for every tax type that applies to you. There is no cost for the switch itself. Mid-year switches are routine and do not require waiting for a year end.

What we do

Statutory accounts filed at Companies House; CT600 corporation tax returns filed with HM Revenue & Customs; self-assessment for sole traders, landlords and company directors; VAT returns under Making Tax Digital; monthly payroll under PAYE; company formation and incorporation planning; and specialist accounts for Uber, Bolt and private hire drivers.

Common questions

How is rental income taxed?

Rental profit is taxed at your marginal income tax rate — 20%, 40% or 45%. Mortgage interest is no longer deducted from rental profit directly; instead you receive a 20% tax credit (the Section 24 restriction).

What landlord expenses can I claim?

Letting agent fees, repairs and maintenance (but not improvements), insurance, council tax or utilities you pay as landlord, ground rent, service charges, legal fees for lets under 1 year, accountancy fees, and 20% of mortgage interest as a tax credit.

What is the £1,000 property allowance?

If your gross rental income is under £1,000 you need not declare it. Above £1,000, you may deduct either your actual expenses or a flat £1,000 allowance, whichever is more.