For ease, our workings are based on a cash buyer paying in British Pounds (GBP) for a rental property in the United Kingdom. However, if you are using a buy to let finance option such as a buy-to-let mortgage then you should calculate this into your final figures. When renting a property in the United Kingdom, it is seen as an income and would qualify as a taxable income. The rate of tax that you would have to pay would depend on whether this was your only means of income or if you have another stream of income as your main source.

Example of working out your property yield

This example is based on a property purchased for £95,000 cash with the rent per calendar month being £550 per calendar month (PCM). Select the rental pay frequency and our yield calculator will do the rest...

To work out a net yield, you would need to deduct any additional costs that you would accrue during the year whilst the property is rented. Examples of these types of deduction can be property management fees, property maintenance charges and ground rent charges.

These additional deductions can alter the final income between a Gross Yield and a Net Yield considerably so it is always advisable to speak with your Estate Agent prior to purchasing the property to ensure you have the complete figures available.

We hope this helps you work out your rental income and shows the benefits of renting property in the UK. If you would like more advice on renting your properties in Bexhill-On-Sea please call us on 01424 224242.