Compare your tax.
See the real difference between holding property personally (with Section 24) and through a limited company. Updated for 2025/26 tax year.
Your details
Personal Landlord
Section 24 applies — mortgage interest is not deductible, you get a 20% tax credit instead.
Limited Company
Mortgage interest is fully deductible. Profits taxed at 19-25% corporation tax, then dividends on extraction.
A limited company could save you tax
Based on your inputs, incorporating could reduce your annual tax bill.
Potential saving
£1,187.00per year
How this comparison works
Personal landlord (Section 24)
- Rental income is added to your other income
- Tax is calculated on the full amount (no mortgage deduction)
- You receive a 20% tax credit on mortgage interest
- Higher-rate taxpayers are hit hardest
Limited company
- Mortgage interest is fully deductible from rental income
- Corporation tax (19-25%) is paid on the net profit
- Remaining profit is extracted as dividends
- Dividend tax rates apply on extraction
This is a simplified comparison. Additional factors such as company running costs, capital gains implications of transferring properties, and stamp duty on incorporation are not included. Always consult a qualified tax adviser before making incorporation decisions.
Common questions
Section 24 (Finance Act 2015) removed the ability for individual landlords to deduct mortgage interest from rental income. Instead, you receive a basic-rate (20%) tax credit. This increases the effective tax rate for higher-rate and additional-rate taxpayers, making limited company ownership potentially more tax-efficient.
Ready to manage your properties smarter?
Latch brings together everything landlords need — property management, AI assistance, compliance, and more.