UK landlord tax guide: income, CGT, and allowances

UK landlords pay Income Tax on rental profits (rental income minus allowable expenses), restricted from full mortgage interest relief since 2017 for individual landlords. On selling a rental property, Capital Gains Tax is due — 18% basic-rate band, 24% higher-rate band — within 60 days of completion.

Rental income reporting: what HMRC expects

UK landlords report rental income on Self Assessment, with separate sections for UK property and overseas property, plus separate treatment for Furnished Holiday Lets (regime abolished from April 2025) and rent-a-room schemes. The deadline is 31 January following the tax year end. From April 2026, landlords with gross rental income over £50,000 must also comply with MTD for Income Tax.

Property portfolio structure: personal vs limited company

For UK landlords building a property portfolio, the structural decision is whether to hold properties personally or in a limited company. Personal ownership is simpler but for higher-rate taxpayers with mortgaged property, the mortgage interest restriction makes the company route increasingly tax-efficient. The break-even point typically arises around 3-4 mortgaged properties for a higher-rate taxpayer.