Residential

Cash Flow Calculator

Project monthly and annual net cash flow, before and after tax.

Intermediate

Introduction

Who this is for: Landlords assessing whether a property genuinely pays its way.

Why it matters: Since Section 24, individual landlords cannot deduct mortgage interest from rental income — they receive a 20% tax credit instead. Higher-rate taxpayers are therefore taxed on income they never actually keep, which is why many properties that look profitable pre-tax are not.

Typical scenario: A higher-rate taxpayer checking real post-tax cash flow on a leveraged buy-to-let.

Common mistakes:
  • Modelling pre-tax cash flow only, which for higher-rate individual landlords is misleading.
  • Forgetting Section 24 applies to individuals but not limited companies.
  • Omitting a capex reserve — boilers and roofs are not optional.

Inputs

Income

£
%

Costs

£
%
%
£
£
£

Tax

%

Analysis

Effective rent of £14,250 less £12,850 of costs gives £117 monthly pre-tax. After £2,120 of tax (individual basis), that becomes £-60 a month.

This analysis provides context, not financial advice. Consult a qualified adviser before making investment decisions.

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Sensitivity Analysis

Sensitivity

Adjust the variables below to stress-test this scenario. Results update instantly.

£1,250
£0£2,500
£650
£0£1,300

Export

Live Results

Monthly Cash Flow (pre-tax)

£117

Monthly Cash Flow (post-tax)

£-60

Annual Cash Flow (post-tax)

£-720

Annual Tax

£2,120

Section 24 applies: you are taxed on £9,200 of profit despite real profit being £1,400, receiving only a 20% credit on the £7,800 interest. This is why many higher-rate landlords hold property through a company.
This property is cash-flow negative after tax — it costs money to hold each month.
Tax takes 151% of real profit. Worth taking advice on structure.
Effective Annual Rent£14,250
Total Annual Costs£12,850
Taxable Profit£9,200
Effective Tax Rate on Real Profit151.43%