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Updated for 2026 Tax Year
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Rental Yield Calculator

Professional UK rental investment model with Section 24 logic, company tax mode, and portfolio-grade stress testing.

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UK Rental Investment Summary

What is Rental Yield? It is the annual return on your property investment, expressed as a percentage of its value. It is the most important metric for measuring how efficiently your capital is working.

Why it Matters: A simple Gross Yield can be misleading. In 2026, rising interest rates and UK tax restrictions (Section 24) mean that a property with a high gross yield could still result in a monthly loss. This tool helps you identify the real profit after hidden costs and taxes.

Benchmark

Compare this deal against UK 2026 averages.

Stress Test

See if rent can sustain 2026 mortgage pressure.

Tax Impact

Preview how Section 24 affects take-home profit.

Property Status

£

£

£

Maintenance/CapEx planned this year

Mortgage Type

£

Interest Rate: 0.00%

£

£

£

Vacancy Rate: 0.00%

Management Fee: 0.00%

Maintenance Reserve Method

%

Recommended: 1% of property value/year.

2026 Assumption Notes

- Management fee benchmark: 10-15% (+VAT), 12% baseline.- Vacancy benchmark: 5% (about 2 weeks).- Other annual costs benchmark: £500-£1,500.- Reserve is a provision and not tax-deductible until invoiced spend occurs.

Ownership Structure

£

Joint Ownership

Decision Metrics
Monthly Net Cashflow

£0

Gross Yield

0.00%

Net Yield (Stress-Tested)

0.00%

Return on Equity (ROE)

0.00%

Section 24 Note

Personal tax band applied: 40% (higher). Section 24 credit: £0. Annual tax due: £0.

Breakdown
LabelMonthly ValueAnnual Value
Potential Rent£0£0
Vacancy Loss£-0£-0
Management Fees£-0£-0
Maintenance Reserve£-0£-0
Planned Repairs£-0£-0
Mortgage Payment£-0£-0
Tax Due£-0£-0
Net Cashflow£0£0

Break-even Occupancy: 0.00%

Break-even Vacancy Buffer: 12.00 months/year

Investment Verdict: REVIEW (MARGINAL)

This property provides a 0.00% return. After accounting for a 0.00% reserve and higher rate tax (40%) obligations, your 'True' monthly profit is £0. Underperforming as an income asset. Consider if capital is better utilized elsewhere.

💡 Structure Alert: Section 24 is heavily restricting your interest relief. At this tax band, incorporation (Limited Company) may yield higher take-home profit.

Next Steps

- Consult a tax advisor regarding incorporation.

Disclaimer: This verdict is based on mathematical yield and 2026 tax assumptions. It does not account for potential house price growth or individual financial circumstances. Always consult a qualified mortgage broker or tax professional before making a decision.Note for personal owners: You are being taxed on turnover, not profit. The 20% tax credit does not fully offset the 40% tax on the income used to pay your mortgage interest.Maintenance: Estimated using the 1% Rule (Property Value) or 10% Rule (Rent). HMRC only allows deduction of 'Actual Repairs,' not 'Reserves'.MTD 2026 Compliance
Reference

Guidance & FAQ

  • Net Yield is computed from annual net operating income divided by current property value.
  • Section 24 is applied for personal ownership with mortgage-interest restriction and 20% tax credit.
  • Stress outcomes include vacancy and financing pressure to estimate resilient monthly cashflow.

Last Updated: 16 Apr 2026

Need a full audit of these calculations? Download the Professional PDF Report

Links & Resources
GOV.UK: Tax on rental incomeGOV.UK: Restriction on finance costs (Section 24)

Important disclaimer

Content on this site is for educational and planning purposes only and does not constitute regulated financial advice. Always assess your own circumstances and seek guidance from a qualified adviser where appropriate. See the full disclaimer.