Landlord tax calculator
The question every landlord argues about: own a buy-to-let in your own name or in a limited company? This works out your tax bill both ways, with Section 24 built in, and shows what the April 2027 changes do to it.
Owned in your name
£3,600 tax on £6,000 of real profit, a 60% effective rate. That is Section 24 at work.
Held in a limited company
Leave the profit in the company and the tax is just £1,140. The dividend tax only applies when you draw it out.
The company keeps about £901 a year more. A company also has setup and accountancy costs, usually higher mortgage rates, and more admin, so it is not automatic. It tends to win for higher-rate landlords growing a portfolio, and lose for a basic-rate landlord with one property.
What changes in April 2027
From April 2027, rental income gets its own higher rates (22% / 42% / 47%) and Section 24 relief rises to 22%. For these figures your personal tax bill moves from £3,600 to £3,720. Switch the year toggle to see the full 2027/28 position.
Estimate only, not tax advice. Simplified for a landlord with other income: it assumes rental profit stacks on top, and it ignores your wider personal-allowance position, other reliefs, associated companies and the real cost of running a company. Section 24 relief is capped at 20% (22% from April 2027) of the lower of your mortgage interest and rental profit. Always confirm with a qualified accountant before restructuring.
Personal or company is a big decision. Talk it through with landlords who have done both in the free Discord.
Ask in the free DiscordWhy Section 24 changes the answer
Since Section 24, an individual landlord cannot deduct mortgage interest as a cost. You are taxed on the rent minus your other expenses, then handed a credit worth only 20% of the interest. A higher-rate landlord pays 40% but gets 20% back, so a big chunk of income that never reaches their pocket still gets taxed. A limited company sidesteps this entirely and deducts all of its interest, which is why companies have become popular for mortgaged portfolios.
A company is not a free lunch
Against the tax saving, a company has formation and annual accountancy costs, usually higher mortgage interest rates, extra admin, and a second tax bill (dividend tax) when you take the money out. For a basic-rate landlord with a single property, personal ownership usually still wins. Run your real numbers before deciding, and take proper advice.
Weighing up a structure or a specific deal? Check it passes a lender with the BTL stress test, size up the yield on the yield map, or ask landlords who have done both in the free Housetrix Discord.
Rates and sources
Figures verified against gov.uk for the 2026/27 and 2027/28 tax years: income tax rates, corporation tax rates, dividend tax, and the 2027 property income rate changes.
Estimate only, not tax or financial advice. Simplified for a landlord with other income and does not cover every personal circumstance. Always confirm with a qualified accountant before restructuring.