Purchase maths and monthly cash flow need separate attention
A deal can look acceptable on headline yield and still feel weak once mortgage cost, insurance, maintenance and void assumptions are carried through into monthly cash flow.
Buy-to-Let Calculator
Buy-to-let calculator for yield, cash flow and lender-criteria planning
Model rent, yield, cash flow and a lender-criteria scenario before you commit time or capital to the deal. Use the page to separate the acquisition maths, landlord rules and lender checks that shape a buy-to-let purchase.
Yield and cash-flow modellingCriteria scenario planningLandlord and tax context
SDLT
Additional dwellings usually carry the 5% surcharge
Letting Rule
Lender permission is usually needed if the property already has a mortgage
Criteria Reality
Published lender criteria differ by product, tax band and rate assumption
Planning Tool
Run the numbers before you move into lender enquiries or tax advice
Use the tabs to separate acquisition cost, rent performance, monthly cash flow and a lender-criteria scenario. That makes it easier to see which part of the deal looks workable and which part needs more checking.
Property and finance inputs
Use the planner for yield, cash flow and product-criteria checks, then compare the result with the actual lender sheet and any tax advice you take.
£
£
Deposit currently equals 25.00% of the purchase price.
%
years
£
Buy-to-let overview
Loan amount
£187,500Gross rental yield
5.76%Interest-only payment
£859.38Repayment payment
£1,151.41SDLT on additional property basis
£15,000Uses current 5% higher-rate surcharge rules
Cash needed before other fees
£77,500Deposit plus SDLT only
LTV
75.00%Use the overview correctly
- This tool does not decide whether a lender will lend. It only models the numbers you enter.
- The SDLT output assumes the purchase is charged on the additional-property basis. Replacement-of-main-residence refunds need to be checked separately.
- The planner focuses on the property, the loan and the rental case. Company-versus-personal ownership still needs case-specific tax advice.
Decision Checks
What the calculator helps you compare
Use the page to separate the main buy-to-let questions instead of rolling them into one headline yield number.
Lender criteria work best as a scenario, not as one national shortcut
You can enter a stress rate and rental-cover target from a product sheet, then see how the rent compares with that scenario without assuming every lender uses the same assumptions.
Ownership structure still needs proper tax advice
HMRC reporting thresholds and allowances are public, but a personal-versus-company recommendation still depends on tax band, extraction plans, other income and professional advice.
Landlord rules belong in the investment case
Lender consent, landlord duties and HMRC reporting shape the admin burden and risk profile of the deal, so they need to sit alongside the financial outputs rather than below them.
Published Criteria
Current published criteria show why one ICR shortcut is not enough
Published lender criteria change by tax position and property type. A current Paragon criteria snapshot is enough to show why one fixed national shortcut does not hold up.
| Published criteria snapshot | Current ICR level | Planning meaning |
|---|---|---|
| Single self-contained property | Paragon currently publishes 125% for basic-rate taxpayers and limited companies, rising to 140% for higher- and additional-rate taxpayers. | The same property can move from workable to tight purely because the tax-band assumption changes. |
| HMO, multi-unit block or other specialist property | The same published criteria rise to 130% for basic-rate taxpayers and limited companies, and to 145% for higher- and additional-rate taxpayers. | Property type can push the rent hurdle higher even before valuation, fees or wider portfolio checks are added. |
Rules and Duties
Landlord and HMRC rules that matter before the offer is agreed
These checks affect the deal before and after completion, not just at the point of mortgage application.
Permission from the lender comes first
If the property already has a mortgage, lender permission usually comes first. That matters for accidental landlords and for anyone switching a former home into a let.
HMRC reporting starts well before portfolio scale
The first £1,000 of property income can fall within the property allowance. Above that, you may need to contact HMRC or register for Self Assessment depending on the income level and expense position.
The SDLT surcharge can reshape the entry cost
Many buy-to-let purchases are charged on the additional-dwelling basis, which currently means a 5% surcharge on top of standard SDLT. The calculator includes that baseline so users do not understate the upfront cash needed.
A positive gross yield does not prove a safe investment
Void periods, maintenance, insurance, compliance work and tax reporting all sit below the headline rent. Review yield, cash flow and criteria together rather than stopping at one gross percentage.
Next Steps
What to check after the numbers still look workable
If the property still looks viable after the first pass, these pages help you stress-test the wider decision.
Buy-to-Let Advice
Read the broader topic page for the current landlord, HMRC and lender-criteria context.
Stamp Duty Calculator
Check the acquisition tax separately if the deal structure is more complicated than a simple additional dwelling.
Mortgage Calculator
Use a standard mortgage payment view if you want to compare repayment and interest-only costs outside the rental case.
Fees and Costs Calculator
Add legal fees, valuations and other transaction costs that sit outside the BTL model itself.
Frequently Asked Questions
Do all buy-to-let lenders use the same rental cover ratio and stress rate?
No. Published lender criteria differ by product, borrower profile, property type and tax position. The same rent can pass one lender scenario and fail another.
Does the calculator tell me whether buying through a company is better?
No. It models yield, cash flow, SDLT and a criteria scenario, but company-versus-personal ownership still needs tax advice based on the borrower, the property and the wider portfolio.
Does the 5% SDLT surcharge usually apply to a buy-to-let purchase?
Usually, yes, because many buy-to-let purchases are treated as additional residential properties. A refund can be available in some replacement-of-main-residence cases if the previous main residence is sold within 36 months.
Can I rent out a property that already has a mortgage on it?
Yes, but you normally need permission from the mortgage lender before renting it out.
When do I need to tell HMRC about rental income?
The first £1,000 of property income can fall within the property allowance. Above that, the reporting route depends on the level of income and expenses, with higher levels usually meaning Self Assessment becomes relevant.
Are buy-to-let mortgages regulated in the same way as residential mortgages?
Not usually. Ordinary investment buy-to-let lending is not regulated in the same way as residential mortgages, while consumer buy-to-let cases sit inside a separate FCA registration regime and need checking carefully.