Buy-to-Let Tax (Section 24)
Work out the tax on your rental profit under Section 24 rules: mortgage interest is no longer deductible from rental income but gives a 20% tax credit instead, for individual landlords.
Dados verificados · julho de 2026
Does Section 24 apply to furnished holiday lets?
No — furnished holiday lettings meeting the qualifying occupancy tests kept full mortgage interest relief until the regime was abolished from April 2025; check the latest FHL rules for your situation.
Fonte: HMRC — Restricting finance cost relief for individual landlords (gov.uk/guidance/changes-to-tax-relief-for-residential-landlords), 2025/26. · atualizado 2026
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Tudo sobre Buy-to-Let Tax (Section 24)
📋Apresentação+
Since the Section 24 reforms, individual landlords can no longer deduct mortgage interest from rental income before calculating tax — instead they get a 20% basic-rate tax credit on the finance cost. This can push landlords into higher tax bands even when their real cash profit hasn't grown, because the full rent (minus non-finance expenses only) is what counts as taxable income. Limited companies are unaffected — they still deduct interest as a normal expense and pay corporation tax instead.
💡 Boas práticas
- Section 24 only applies to individual landlords — moving highly-geared properties into a limited company avoids it, but triggers its own tax costs (SDLT, CGT) on transfer.
- The finance cost credit is capped at 20% even if you're a higher- or additional-rate taxpayer, so highly-mortgaged properties often see a real increase in tax.
- Because the full rent counts as income before the credit, a landlord can be pushed into a higher tax band or lose the personal allowance even without extra cash profit.
🔢 Exemplo concreto
£18,000 annual rent, £8,000 mortgage interest, £2,000 other expenses, held personally: £16,000 taxable rental profit before the finance cost credit, with a 20% credit of £1,600 applied against the tax due.
📖Guia de utilização+
Como usar esta calculadora
- 1
Enter your annual rental income and any allowable expenses other than mortgage interest.
- 2
Enter your mortgage interest paid for the year.
- 3
Add your other income, to work out which tax band the rental profit falls into.
- 4
Select whether the property is held personally or through a limited company.
📚Glossário+
- Section 24
- The rule restricting individual landlords' mortgage interest relief to a 20% tax credit rather than a full deduction from rental income, phased in from 2017 and fully in effect since 2020/21.
- Finance cost credit
- The 20% basic-rate credit applied to mortgage interest and other finance costs, given after income tax is calculated on the full rental profit — it cannot reduce tax below zero.
ℹ️Fontes e atualizações+
Última atualização dos dados
7 de julho de 2026
Fontes e referências
HMRC — Restricting finance cost relief for individual landlords (gov.uk/guidance/changes-to-tax-relief-for-residential-landlords), 2025/26.
Os dados desta calculadora são atualizados regularmente para refletir as últimas tabelas oficiais. Em caso de dúvida, consulte as fontes oficiais indicadas acima.
FAQ — Buy-to-Let Tax (Section 24)
Does Section 24 apply to furnished holiday lets?+
No — furnished holiday lettings meeting the qualifying occupancy tests kept full mortgage interest relief until the regime was abolished from April 2025; check the latest FHL rules for your situation.
Is a limited company always better for buy-to-let?+
Not automatically — companies avoid Section 24 and pay corporation tax on profits, but extracting cash as dividends adds a second layer of tax, and transferring an existing property in triggers SDLT and potential CGT.