Landlord tax calculator
Income tax on rental profit for 2026/27, with the 20% finance cost credit.
Work out landlord taxFREE PROPERTY TOOL
Limited Company Calculator
Compare one year's tax on a rental property held in your own name with the same property held in a limited company.
Hold a buy-to-let in your own name and you pay income tax on the rental profit, with mortgage interest limited to a 20% tax credit. Hold it in a limited company and the company pays Corporation Tax on its profit after interest, then you pay dividend tax on whatever you take out. Which route keeps more depends on your other income, the size of the interest bill and how much you draw.
This calculator compares one year, at 2026/27 rates, for one property. It does not cover the cost of moving a property into a company or buying through one. For the wider picture, read the limited company buy-to-let guide.
CALCULATOR
Personal or company: one year side by side
Letting and management fees, repairs, insurance, service charges
The same interest is assumed for both routes
Salary, pension or self-employed profit for 2026/27. Not savings or dividends
Share of the company's profit after Corporation Tax paid to you as dividends
Difference in money kept, company less personal
On these figures
Personal ownership
Profit after mortgage interest
Income tax after the 20% credit
Kept after tax
Limited company
Company profit after interest
Corporation Tax
Dividends drawn
Dividend tax
Dividends after tax
Retained in the company
Kept, including retained profit
Save to PROXERAAnnual comparison at 2026/27 rates for an individual in England or Northern Ireland with salary, pension or self-employed income and no savings or dividend income, and a company with no other profits and no associated companies. Ignores incorporation and company running costs, Stamp Duty Land Tax and Capital Gains Tax on transferring a property, differences in mortgage rates and fees, accountancy costs, and salaries or pension contributions from the company. Default inputs are illustrative examples, not a real property or client.
HOW IT WORKS
How it's calculated
The personal route
Rental profit before interest is added to your other income and taxed at the 2026/27 rates. You then get a tax reduction of 20% of the lowest of your finance costs, your property profit and your income above the Personal Allowance. Money kept is the profit after interest less that tax. The landlord tax calculator shows each step.
The company route
The company deducts the mortgage interest along with its other costs and pays Corporation Tax on the profit: 19% on profits up to £50,000 and 25% above £250,000, with Marginal Relief in between. The limits are divided between associated companies and reduced for accounting periods shorter than 12 months.
Dividends you draw sit on top of your other income. The first £500 is covered by the dividend allowance, then dividends are taxed at 10.75%, 35.75% or 39.35% depending on the band they fall in. Money kept is the dividends after tax plus any profit left in the company.
| Rate or allowance | Used here |
|---|---|
| Corporation Tax small profits rate, profits up to £50,000 | 19% |
| Corporation Tax main rate, profits over £250,000 | 25% |
| Marginal Relief standard fraction, £50,000 to £250,000 | 3/200 |
| Dividend allowance | £500 |
| Dividend rates: basic, higher, additional | 10.75%, 35.75%, 39.35% |
| Income tax rates: basic, higher, additional | 20%, 40%, 45% |
| Personal Allowance | £12,570, reduced above £100,000 |
| Finance cost credit for individuals | 20% |
A worked example
With the example figures, the profit after £8,000 of interest is £4,600 either way. Personally, with £60,000 of other income, the £12,600 profit before interest is taxed at 40%, £5,040, less a £1,600 credit: £3,440 of tax leaves you £1,160. In a company, Corporation Tax at 19% is £874, leaving £3,726. Drawn in full, £500 is covered by the allowance and the rest is taxed at 35.75%, £1,153, leaving £2,573. The company route keeps £1,413 more on these figures.
What this leaves out
- Setting up and running a company, including accountancy and filing costs
- Stamp Duty Land Tax and Capital Gains Tax on moving a property you already own into a company
- Differences in mortgage rates, fees and lender criteria for company borrowing
- Salaries, pension contributions or loans from the company
- The property income rates due from 6 April 2027
- Scottish and Welsh rates of income tax
A company can also change how a lender tests the rent. Try the buy-to-let mortgage calculator with each cover ratio. Whichever route you choose, PROXERA keeps each property's income and costs in one place.
FAQ
Limited company buy-to-let, answered
Why can a company come out ahead?
A company deducts mortgage interest from its profit before Corporation Tax at 19% to 25%. An individual pays income tax on profit before interest and gets a 20% credit back, so a higher-rate taxpayer pays 40% on rent that goes on interest. The gap narrows once dividend tax is paid on what you draw from the company.
Is a company always better for higher-rate taxpayers?
No. The answer depends on the interest bill, how much you draw, your other income and costs this calculator leaves out, including accountancy, company mortgage pricing and the cost of setting up. Take advice before choosing a structure.
Can I move a property I already own into a company?
You can, but the company is buying it from you. For Stamp Duty Land Tax, a transfer to a company you are connected with is charged on at least the property's market value. Capital Gains Tax and refinancing costs can also apply. None of these are included here.
What happens to profit left in the company?
It has paid Corporation Tax but not dividend tax. It can stay in the company, for example towards the next deposit, and dividend tax applies when you draw it, at the rates in force then.
Will the April 2027 changes affect the comparison?
From 6 April 2027, individuals in England, Wales and Northern Ireland are due to pay 22%, 42% and 47% on property income, with the finance cost credit at 22%. That changes the personal route from 2027/28. This calculator uses 2026/27 rates only.
RELATED
Keep going with the numbers.
Buy-to-let mortgage calculator
See how much the rent could support, tested at a stress rate.
Test your borrowingCapital gains tax calculator
Estimate CGT on selling an investment property in 2026/27, for one owner or two.
Estimate CGTStamp duty calculator
Estimate SDLT for England and Northern Ireland, band by band, including surcharges.
Estimate stamp dutyLimited company buy-to-let
A guide to buying and holding rental property through a limited company.
Read the guideStamp duty on second homes
How the higher rates apply to buy-to-let and additional property purchases.
Read the guideThis calculator gives an estimate based on the information entered and the 2026/27 rates set out above. It is general information, not tax or legal advice, and it does not tell you which structure to use. Default inputs are illustrative examples, not a real property or client. Speak to a qualified tax adviser before buying through or moving property into a company, or contact us to talk through your plans. Proxera Ltd is not authorised and regulated by the Financial Conduct Authority. For mortgage advice, speak to an FCA-authorised mortgage broker. Property investment involves risk: capital is at risk and past performance is not a reliable indicator of future results.
Sources: GOV.UK, Rates and allowances: Corporation Tax, GOV.UK, Corporation Tax rates and reliefs, GOV.UK, Marginal Relief for Corporation Tax, legislation.gov.uk, Corporation Tax Act 2010, section 18B, GOV.UK, Tax on dividends, GOV.UK, Income Tax rates and Personal Allowances, GOV.UK, Income over £100,000, GOV.UK, Changes to tax relief for residential landlords: how it's worked out, HMRC Property Income Manual, PIM2052, HMRC Stamp Duty Land Tax Manual, SDLTM30220, GOV.UK, Change to tax rates for property, savings and dividend income: technical note. Checked 22 October 2026.
GET MATCHED
Your next property, matched by technology.
Tell us what you are looking for. We reply within one working day, and PROXERA keeps the search going for you.