# What is the mortgage interest tax credit for landlords?

> Quick answer · Last updated 4 July 2026

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## In short

Since 2020 landlords cannot deduct mortgage interest from rental income. Instead you receive a 20% tax credit on finance costs — worth less for higher-rate taxpayers who previously deducted interest at 40% or 45%.

The credit is calculated on mortgage interest, not capital repayments. It reduces your tax bill but not your taxable rental profit directly.

Additional-rate taxpayers get only 20% relief on interest, not 45% — a significant change from pre-2020 rules.

See our rental income tax guide and buy-to-let yield calculator.

## Related

- [Rental income tax UK](https://moneyguide.org.uk/benefits-tax/rental-income-tax-uk/)
- [How is rental income taxed?](https://moneyguide.org.uk/answers/how-is-rental-income-taxed/)
- [Buy-to-let yield calculator](https://moneyguide.org.uk/tools/buy-to-let-yield-calculator/)

## Primary source

gov.uk/guidance/changes-to-tax-relief-for-residential-landlords-how-its-worked-out

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Independent UK money guidance from [Money Guide](https://moneyguide.org.uk). Information only — not regulated financial advice.