Rental yield calculator UK: gross, net and after tax

Rental yield calculator

Purchase price

The price you pay for the property, before buying costs.

Buying costs

Stamp Duty Land Tax (LBTT in Scotland, LTT in Wales), legal fees and survey.

Works and furnishing

What you spend before the first let: refurbishment, and furniture for a furnished let.

Monthly rent

The rent the tenant pays each month.

Empty months a year

On average, the time without a tenant, for example 0.5 for about two weeks.

Running costs for a year

Letting agent’s fee (% of rent)

Including VAT, as a percentage of the rent collected. Leave empty if you manage the let yourself.

Service charge and ground rent (a year)

For a leasehold flat: what the freeholder charges you each year.

Landlord insurance (a year)

Buildings and contents cover, and rent guarantee if you take it.

Repairs and other costs (a year)

Maintenance, repairs, safety certificates, accountancy: your estimate for a year.

After tax (optional)

Estimate tax at your marginal rate

The band your rental profit falls in for 2026 to 2027. From April 2027, property income is due to get its own rates.

Gross yield

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Enter the purchase price and the rent to see the yield.

Net yield, before tax: —
Net yield after tax: —
Rent for 12 months: —
Rent collected, after empty months: —
Running costs for the year: —
Net income before tax, a year: —
That is, a month: —
Total cost of the purchase: —
Estimated taxable profit: —
Estimated Income Tax: —
Estimated French social levies: —
Net income after tax, a year: —

Recent calculations

Nothing yet: copy, export or save a calculation to find it here.

How it works

Enter the purchase price and the monthly rent to see the gross yield. Add your buying costs, empty months and running costs for the net yield and, if you like, your Income Tax rate for an estimate after tax at 2026 to 2027 rates. Amounts are rounded to the nearest penny and yields to two decimal places.

Gross yield

The rent for a year divided by the purchase price. It is quick for comparing listings, but it ignores buying costs, empty months and running costs, so it always flatters a property.

Net yield

It starts from the rent you actually collect after empty months, takes off the costs you pay as the landlord (letting agent’s fees, service charge and ground rent, insurance, repairs and maintenance) and divides what is left by the total cost of the purchase: the price, buying costs such as Stamp Duty Land Tax and legal fees, and any works before the first let.

After tax

Choose the Income Tax rate your rental profit falls in. The calculator deducts your running costs, or the £1,000 property allowance when that is larger, because you can claim one or the other but not both. It uses the 2026 to 2027 rates: 20%, 40% and 45% in England, Wales and Northern Ireland, and the Scottish rates from 19% to 48% for Scottish taxpayers.

What it leaves out

The calculation is for a property bought outright. It does not include mortgage interest, losses brought forward from earlier years, replacement of domestic items relief, or the way the rent can push part of your income into a higher band. The tax shown is an estimate at one marginal rate, not a tax return.

Gross yield = monthly rent × 12 ÷ purchase price × 100.

Net yield = (rent collected − running costs) ÷ (price + buying costs + works) × 100.

Net yield after tax = (net income − Income Tax) ÷ total cost × 100.

Example: a flat bought for £200,000 and let at £1,000 a month

A year’s rent is £12,000.00, a gross yield of 6%. With about two weeks empty (0.5 months), a 12% agent’s fee, £1,200 of service charge and ground rent, £300 of landlord insurance and £600 of repairs, the running costs come to £3,480.00 out of £11,500.00 of rent collected, leaving a net income of £8,020.00. Against a total cost of £213,000.00 (the price, £11,500 of Stamp Duty Land Tax at the higher rates for an additional property in England, and £1,500 of legal fees), the net yield is 3.77%. At the basic rate of 20%, Income Tax of £1,604.00 brings the yield after tax to 3.01%.

Frequently asked questions

What is the difference between gross and net rental yield?

Gross yield divides the yearly rent by the purchase price. Net yield first takes off empty months and the landlord’s running costs, then divides by the total cost of the purchase, including buying costs and works. In the example above, the gross yield is 6% and the net yield 3.77%.

Should I include Stamp Duty in the yield?

In the net yield, yes: it is part of what the property cost you. Buying an additional residential property in England or Northern Ireland usually means paying 5% on top of the normal Stamp Duty Land Tax rates. In Scotland, Land and Buildings Transaction Tax carries an Additional Dwelling Supplement of 8% of the price, and in Wales, Land Transaction Tax has higher residential rates.

Which costs can I deduct for tax?

Day-to-day running costs, such as letting agents’ fees, insurance, maintenance and repairs, service charges and ground rent, are allowable expenses. The cost of buying the property and improvements beyond repairs are not. An individual landlord cannot deduct mortgage interest either, and gets basic rate relief as a tax reduction instead.

When does the £1,000 property allowance apply?

If your gross property income for the tax year is £1,000 or less, it is tax-free and you usually do not need to tell HMRC. Above that, you can deduct £1,000 instead of your actual expenses: in HMRC’s own example, £1,200 of receipts leaves £200 of taxable profit. It only helps when your expenses are lower than £1,000, and the calculator picks whichever deduction is larger.

Will tax on rental income change?

Yes. From 6 April 2027, property income in England, Wales and Northern Ireland is due to be taxed at its own rates of 22%, 42% and 47%, two points above today’s. The calculator uses the 2026 to 2027 rates in force now.

Does it allow for a buy-to-let mortgage?

No: it gives the yield of the property itself, as if bought outright. To see how monthly payments and interest affect your cash each month, use a rental cash flow calculation.

Rental yield calculator