Property income tax rates for landlords from April 2027: 24%, 44% and 49%
Budget 2026 announced property income tax rates of 24%, 44% and 49% from 6 April 2027 in England, Wales and Northern Ireland; they are not yet law (Finance Bill 2026-27). They are not set for Scotland: the UK government has given Scotland and Wales the ability to set property income rates.
What happened
Budget 2026 increases all income tax rates on property income by 2 percentage points, on top of the 2 point rise from April 2027 already announced in Budget 2025. From 6 April 2027 the property basic rate will be 24%, the property higher rate 44% and the property additional rate 49%. HMRC's Annex A confirms the same three rates for 2027-28. The change will be legislated for in Finance Bill 2026-27.
The government is increasing all the rates of income tax applied to property income by 2 percentage points. From 2027 to 2028, the property basic rate will be 24%, the property higher rate will be 44%, and the property additional rate will be 49%. This will be legislated for in Finance Bill 2026-27 and take effect from 6 April 2027.
Status: Announced by the government
HM Treasury (GOV.UK) — Budget 2026 (HTML), 28 October 2026
These rates will apply across England, Wales and Northern Ireland.
HM Treasury (GOV.UK) — Budget 2026 (HTML), 28 October 2026
Budget 2025 had already increased the rates of tax on savings and property income by two percentage points across all tax bands from April 2027; Budget 2026 increases these rates by a further two percentage points from that date. HM Treasury says 84% of income tax payers will be unaffected by these changes.
HM Treasury (GOV.UK) — Budget 2026 (HTML), 28 October 2026
HMRC's Annex A lists the property basic rate at 24%, the property higher rate at 44% and the property additional rate at 49% for tax year 2027 to 2028, and 'Not applicable' for tax year 2026 to 2027. For tax year 2026 to 2027, property income is charged at the main rates of income tax.
HM Revenue & Customs (GOV.UK) — Budget 2026 OOTLAR Annex A: rates and allowances, 28 October 2026
The main rates of income tax are 20%, 40% and 45% in tax year 2026 to 2027 and unchanged at 20%, 40% and 45% in tax year 2027 to 2028. From April 2027, the property rates of income tax are separated from the main rates.
HM Revenue & Customs (GOV.UK) — Budget 2026 OOTLAR Annex A: rates and allowances, 28 October 2026
For trusts in tax year 2027 to 2028, the property trust rate for accumulated and discretionary property income is 49%.
HM Revenue & Customs (GOV.UK) — Budget 2026 OOTLAR Annex A: rates and allowances, 28 October 2026
The government has provided the devolved governments of Scotland and Wales with the ability to set property income rates in line with their current Income Tax powers.
HM Revenue & Customs (GOV.UK) — Budget 2026: overview of tax legislation and rates (OOTLAR), 28 October 2026
What it means
In 2026-27 property income is still taxed at the main rates of 20%, 40% and 45%. From 2027-28 it has separate property rates, while the main rates on earnings and pensions stay at 20%, 40% and 45%. Landlords who pay income tax on rental profits will pay more on the same profit from April 2027. The Budget sentence applies across England, Wales and Northern Ireland; it does not cover Scotland, and HMRC notes that the Scottish and Welsh governments have been given the ability to set property income rates in line with their current Income Tax powers.
Who is affected
- Individual landlords in England, Wales and Northern Ireland with taxable rental income
- Anyone receiving other taxable property income charged to income tax
- Trustees of accumulated or discretionary trusts with property income
- Not covered by the Budget sentence: Scottish taxpayers, whose position the sources do not set out
UKCalc's interpretation
The section below is UKCalc's analysis. It is separated from the facts above deliberately: it is arguable, and the facts are not.
Until 5 April 2027 rental profits are taxed at the same rates as wages. From 6 April 2027 they have their own, higher property rates, reflecting both the Budget 2025 and the Budget 2026 increases, while the main rates on earnings stay the same.
UKCalc's reading of the evidence above, not a statement by any source.
The Budget sentence covers England, Wales and Northern Ireland only. It does not set property income rates for Scottish taxpayers, and UKCalc does not speculate about them.
UKCalc's reading of the evidence above, not a statement by any source.
Questions this answers
- What are the new property income tax rates from April 2027?
- When do the higher tax rates on rental income start?
- Do the new property income tax rates apply in Scotland?
- How do the property rates compare with the main income tax rates?
- Is the property income rate rise law yet?
Sources
- HM Treasury (GOV.UK) — Budget 2026 (HTML) · 28 October 2026
- HM Revenue & Customs (GOV.UK) — Budget 2026 OOTLAR Annex A: rates and allowances · 28 October 2026
- HM Revenue & Customs (GOV.UK) — Budget 2026: overview of tax legislation and rates (OOTLAR) · 28 October 2026
Statutory figures belong to the body that publishes them. UKCalc compiles and verifies them, and any calculation built on top is UKCalc's own — see the governed rates reference.