The deposit is only one part of a buy-to-let budget. Before committing to a property, separate the money needed to complete the purchase from the cash needed to operate it and the tax position. A promising advertised rent does not answer all three questions.
Start with the purchase budget
List the deposit, conveyancing, survey, mortgage charges and any work needed before letting. Obtain quotes for the actual property rather than applying one national percentage to everything.
For England and Northern Ireland, HMRC says buyers who will own more than one residential property usually pay an additional five percentage points of Stamp Duty Land Tax. For a straightforward £200,000 purchase subject to those higher rates, with no other surcharge or relief, the calculation is £6,250 on the first £125,000 and £5,250 on the remaining £75,000: £11,500 in total. This is an illustration, not a quote for every buyer.
[Check HMRC's rates and calculator](https://www.gov.uk/stamp-duty-land-tax/residential-property-rates). Scotland and Wales have different property transaction taxes.
Plan the ongoing cash requirement
MoneyHelper explains that buy-to-let borrowing often needs a substantial deposit, and interest-only payments do not reduce the capital owed. It also warns landlords to prepare for periods without rent and major repairs. Compare product fees as well as the headline mortgage rate.
[Read MoneyHelper's mortgage guidance](https://www.moneyhelper.org.uk/en/blog/buy-or-rent-a-home/buy-to-let-mortgages-explained).
Our suggested budget has separate lines for finance, insurance, management, routine repairs, compliance work and any leasehold charges. Add a reserve rather than treating every pound of rent as available income. Test what happens if the property is empty for a period or an unexpected repair lands in the same month as another bill. Those are planning scenarios, not forecasts.
Cash flow is not the tax calculation
HMRC distinguishes allowable running expenses from capital expenditure. Its guidance lists costs such as agent fees, insurance and repairs, while improvements receive different treatment. Mortgage interest treatment also differs between individual landlords and companies; do not assume the entire mortgage payment is deductible.
[Check rental income tax guidance](https://www.gov.uk/renting-out-a-property/paying-tax).
Keep invoices and obtain advice tailored to ownership, borrowing and the relevant tax year. A useful investment comparison shows the assumptions as clearly as the expected return. This is general budgeting information, not a recommendation to buy a particular property.