This calculator can be used to examine the Return On Investment generated by rental property and the effect that mortgage borrowing has on the returns enjoyed. See below the calculator for further notes. Coloured sections will be calculated for you.
All results are before tax.
Mortgage interest can be set against rental income for tax purposes. This makes it possible for all the mortgage interest to be tax deductable, reducing the effective cost of borrowing by the tax rate payable. Other expenses may also be tax deductable. A quick way of determining this is to compare the ROI obtained with and without a mortgage. A message appears under the summary to indicate whether a higher return is acheieved with or without borrowing.