A complete view of your buy-to-let returns. Enter the price, your deposit, the rent and running costs to see gross yield, net yield, annual cash profit and cash-on-cash return on the money you invest.
Price · deposit · rent · costs
Serious property investors look beyond simple yield. This calculator gives you three figures: gross yield (rent vs price), net yield (rent minus costs vs price) and the all-important cash-on-cash return — your annual profit as a percentage of the actual cash you put in. Because most BTLs are mortgaged, cash-on-cash is often much higher than the yield, thanks to leverage.
| Metric | Formula |
|---|---|
| Gross yield | Annual rent ÷ property price |
| Net yield | (Annual rent − costs) ÷ property price |
| Cash-on-cash | Annual cash profit ÷ cash invested |
Put down a £60,000 deposit on a £220,000 property earning £6,000 a year in net profit, and your cash-on-cash return is 10% — far above the ~3% net yield, because your money controls a much larger asset. Of course leverage cuts both ways: a rate rise or void period eats into a thin margin fast. Stress-test the mortgage with the buy-to-let mortgage calculator.
This calculator shows your cash return before tax. Landlord profits are taxed at your marginal rate, with mortgage interest only getting a 20% credit (Section 24). Work out the real after-tax position with the rental income tax calculator, and your simpler yield with the rental yield calculator.
Many investors aim for a cash-on-cash return of 8%+ — annual profit as a percentage of the cash you invested, usually higher than the yield thanks to leverage.
Gross yield = annual rent ÷ price. Net yield deducts running costs first. A £220,000 property at £1,200/month yields about 6.5% gross.
Yield is measured against the whole property price; cash-on-cash is measured against just your invested cash — so it's much higher on a mortgaged BTL.
No — it shows the pre-tax cash return. Use the rental income tax calculator for the after-tax position, including the mortgage interest credit.
