2027/28 property income tax rates (22%, 42%, 47%) explained for landlords

Updated 15 October 2026

Finance Act 2026 sets separate property rates of income tax for 2027/28: 22% basic, 42% higher and 47% additional (Finance Act 2026 s.7). HMRC's technical note confirms the change starts on 6 April 2027. The residential finance-cost reducer will be given at the property basic rate of 22%, and the property allowance is unchanged (gov.uk).

What changes for 2026/27?

Nothing. This tax year (to 5 April 2027) still uses 20/40/45% and a 20% reducer (gov.uk).

Example: basic-rate landlord

Rental profit £10,000 (before interest), all in the basic band, with no mortgage. 2026/27: £2,000. 2027/28: £2,200, so £200 more.

Example: with £4,000 mortgage interest

2026/27: £2,000 − (20% × £4,000) = £1,200. 2027/28: £2,200 − (22% × £4,000) = £1,320. The extra cost is 2% of the profit before interest.

These examples are simplified (England, Wales and NI; the same band position; no other reliefs). The tracker's rate cells are editable, so you can model 2027/28 now.

Estimate only, not tax advice. Rough figures for individual UK residential landlords using England, Wales and Northern Ireland rates. Check with HMRC or a qualified accountant.

Keep MTD-ready records for every property with the UK Landlord Property Tracker (£12), or try the free Section 24 calculator.

Rates checked on 15 October 2026 against official sources: gov.uk income tax rates · Section 24 relief · property allowance · MTD quarterly updates · 2027/28 property rates (Finance Act 2026 s.7).

General information only, not tax, legal or financial advice. Our liability is capped at the price paid, as far as the law allows. Your statutory rights are not affected. See the terms of sale. · All Kept Sheets