The only free UK rental yield calculator that gives you the number that actually matters: the net-of-tax yield. Most calculators show a "gross yield" or a "net yield" that ignores Section 24 — the rule (fully phased in since April 2020) that stops individual landlords deducting mortgage interest from rental income. A 6% gross yield can become a negative after-tax cash flow once Section 24 bites. This calculator routes your inputs through the full UK tax stack: Section 24 reducer for individuals, corporation tax with marginal relief for limited companies, plus the +5% SDLT surcharge on acquisition.
Rental Yield & ROI
The yield calc that gives you the answer that actually matters: net-of-tax. Models Section 24 for personal landlords and corporation tax for limited-company landlords, in one engine.
Renters' Rights Act 2025 — in force since 1 May 2026
Yield headlines
Net-of-tax yield is the only one most calculators don't surface — and the only one that reflects what actually hits your bank account.
Gross yield
6.72%
Net yield
5.13%
Net-of-tax yield
3.90%
Includes Section 24 reducer at your band.
Cash-on-cash
-0.66%
After-tax cash ÷ all-in cash deployed.
Cash flow waterfall (annual)
Pre-tax cash
£2,502
After-tax cash
-£562
Rental tax (Section 24)
£3,063
Cash vs taxable profit — 10-year projection
The signature Section 24 visual. Shaded wedge = the cost of S24 — tax on profit you never actually saw.
Section 24 detail
Tax is computed on taxable profit (interest not deducted), then a 20% credit is applied.
Effective tax rate on rental income
Taxable profit
£12,814
Cash profit
£2,502
Section 24 wedge
£10,313
Reducer (20% credit)
£2,063
Effective rate on rental
122.5%
Cost of S24 vs pre-2017
£2,062
Counterfactual: tax under old full-interest-deduction rules.
Net-of-tax yield by tax band
The same property, run through different tax positions. The single most important reason to consider structure.
Acquisition & break-evens
Stamp duty
£15,000
6.00% effective
All-in cash
£84,600
Deposit + SDLT + fees + refurb
Break-even monthly rent
£1,449
Break-even occupancy
98.3%
Calculations are first-year snapshots; a multi-year projection arrives in the full BTL investment model (Tier 2). For planning purposes only — not advice.
Frequently asked questions
Answers to the questions UK property investors most often have about this tool and the underlying rules.
- What is a good rental yield in the UK in 2026?
- Gross yields in major UK cities currently range from 4-7% for residential BTL, with northern cities (Liverpool, Manchester, Leeds) typically at the higher end and London at the lower end. After Section 24, mortgage interest and operating costs, the after-tax net yield for a higher-rate landlord is often 1-3 percentage points lower than the gross — sometimes negative on heavily-leveraged London property.
- Why is my net-of-tax yield negative even though the gross looks healthy?
- Section 24 taxes you on rent minus operating expenses, with no deduction for mortgage interest — you only get a 20% tax credit on the interest (rising to 22% from April 2027). For a higher-rate landlord paying 40% on a £15,000 taxable profit, the 20% credit on £10,000 of interest doesn't fully offset the £4,000 extra tax. Add operating costs and vacancy, and the cash flow can flip negative.
- Does this calculator work for limited-company BTLs?
- Yes. Switch the ownership toggle to "Limited company" and the calculator uses corporation tax (19% to £50k profits, marginal relief 50-250k, 25% above) with full mortgage interest deductibility. Section 24 does not apply to companies. We do not model the +0.5-1pp typical rate premium SPV mortgages carry — set the interest rate higher to reflect this.
- What costs should I include?
- Mandatory: management fee (8-12% if outsourced), maintenance (set aside 5-10% of rent), insurance, service charge / ground rent for leasehold, letting agent fees, void allowance (5% of rent is typical). Optional: tenant turnover replacement of furniture under the s311A relief.