9 Landlord Tax Saving Tips for 2026/27
Written and reviewed by Zoe, Managing Director at Kernow Accountancy : our family-run Helston practice has been advising Cornish sole traders, landlords and small businesses since 2011.
Rental income is taxable, but how much you pay depends on how well you plan. Nine practical ways UK landlords can cut their tax bill in 2026/27.
Rental income is taxable, but how much tax you actually pay depends on how well you plan. Many UK landlords overpay simply because they miss allowable expenses or do not structure their income efficiently.
At Kernow Accountancy, we help landlords across the UK reduce their tax bills legally and confidently. Here are nine proven landlord tax saving strategies for 2026/27.
1. Claim every allowable expense
The simplest landlord tax saving tip: deduct every legitimate cost from your rental income before tax is calculated.
Commonly missed allowable expenses include:
| Expense | Examples |
|---|---|
| Letting agent fees | Tenant find and management fees |
| Landlord insurance | Buildings and landlord cover |
| Repairs and maintenance | Plumbing, roofing, boiler repairs |
| Accountancy fees | Tax returns, bookkeeping |
| Advertising | Finding new tenants |
| Ground rent and service charges | Leasehold properties |
| Utility bills | Where paid by the landlord |
2. Repairs versus capital improvements
Repairs, such as fixing a leak or servicing a boiler, are deductible immediately against rental income.
Improvements, such as a new extension or a major heating upgrade, are not. Keep those receipts instead; they reduce Capital Gains Tax when you sell.
3. Use the property allowance wisely
The first £1,000 of gross rental income is tax free. Above that, choose between the flat £1,000 allowance or your actual expenses, not both.
| Situation | Best action |
|---|---|
| Expenses over £1,000 | Claim actual expenses |
| Expenses under £1,000 | Use the £1,000 allowance |
| You made a loss | Claim actual expenses to carry the loss forward |
4. Maximise domestic items relief
Deduct the cost of replacing furnishings and appliances for tenants, including beds, sofas, carpets, fridges and washing machines, provided the item is a genuine replacement and the old one is disposed of. Full HMRC guidance is on GOV.UK.
5. Shift income to a lower earning spouse
If your spouse pays a lower tax rate, transferring rental income to them can cut your combined bill. HMRC assumes a 50/50 split by default, so you will need:
- A legal Deed of Trust setting the new ownership split
- HMRC Form 17, submitted within 60 days of signing
6. Use the Rent a Room scheme
Renting a furnished room in your own home? You can earn up to £7,500 tax free, or £3,750 each if the property is jointly owned. Note that this cannot be combined with the property allowance or domestic items relief on the same income.
7. Claim travel and mileage expenses
Travel for inspections, tenant meetings or repairs is deductible. Claim HMRC's mileage rate, 55p per mile for the first 10,000 miles and 25p after that, and keep a simple log of dates, destinations and purpose. Small on its own, but it adds up across a portfolio.
8. Prepare for Making Tax Digital
From 6 April 2026, landlords with qualifying income over £50,000 must keep digital records and submit quarterly updates to HMRC. Income over £30,000 brings the same requirement from April 2027, so it is worth preparing now. See our Making Tax Digital for landlords guide for the full picture.
9. Keep robust records all year
Every landlord tax saving claim needs evidence. Keep receipts, track income and costs by property, store tenancy agreements securely, and log travel and unusual expenses. Good records also keep your accountancy fees down.
How much could you save?
Savings vary by portfolio size, income bracket and eligible reliefs, from a few hundred pounds for a single property to significantly more for larger portfolios. The landlords who plan ahead consistently save more than those who rush at deadline time.
Talk to Kernow Accountancy
With property income tax rates rising further in April 2027, proactive planning matters more than ever. Kernow Accountancy offers fixed fee accounting packages for landlords of every size, with no hidden costs, ever. Get in touch for a tax saving review of your property portfolio.
Book a free landlord tax review
General guidance only, not a substitute for personalised advice. Contact Kernow Accountancy for support tailored to your situation.
