Rental Yield Calculator
Last updated: April 2026
Property Details
£
£
Mortgage
Use the Mortgage Repayment Calculator for this figure.
£
For tax planning. Mortgage interest relief is restricted for individual landlords.
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Annual Costs
£
£
%
Average void between tenancies. 2 weeks is reasonable for many areas.
wks
£
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Yield Summary
Annual rent£14,400.00
Gross yield5.76%
Annual costs-£4,094.27
Annual net income£10,305.73
Net yield4.12%
After mortgage-£494.27/year
Cash-on-cash return-0.61%
Yield Benchmark
< 4%PoorMay struggle to cover costs
4-5%ModerateMarginal investment case
5-7%GoodPositive cash flow likely
> 7%ExcellentStrong investment
Annual Cost Breakdown
Maintenance£1,500.00 (10.42% of rent)
Insurance£600.00 (4.17% of rent)
Management fee£1,440.00 (10.00% of rent)
Void period loss£554.27 (3.85% of rent)
Ground rent£0.00 (0.00% of rent)
Service charge£0.00 (0.00% of rent)
Total£4,094.27 (28.43% of rent)
Total Investment
Deposit£62,500.00
Stamp duty (est.)£13,750.00
Legal/other£5,000
Total investment£81,250.00
Cash-on-cash return-0.61%
Buy-to-let tax changes
Mortgage interest tax relief is restricted to the basic rate of 20% for individual landlords. This significantly reduces after-tax returns for higher-rate taxpayers. Your actual after-tax income will depend on your total income. Speak to an accountant about your specific situation.
What is rental yield?
Rental yield measures the annual return on a property investment as a percentage of the property value. Gross yield is calculated before costs; net yield accounts for landlord expenses except mortgage payments. A gross yield of 5-7% is generally considered reasonable for UK buy-to-let, though net yields after costs are usually lower.
What is cash-on-cash return?
Cash-on-cash return measures the annual return on the actual cash invested: your deposit, stamp duty, and purchasing costs. Unlike yield, which measures against the full property value, cash-on-cash return shows the return on the money you actually tied up.
What are the tax implications of buy-to-let?
Rental income is taxable above the personal allowance. Since 2020, individual landlords can no longer deduct full mortgage interest from rental income. Instead, they receive a 20% basic rate tax credit. This can significantly increase the tax bill for higher-rate taxpayers. Capital Gains Tax may also apply when the property is sold.
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