Rentcharge is a legal device which permitted an annual payment to be continually levied on a freehold property.

Rentcharges provided a regular income for landowners who were prepared to release land for development, to the original builder, or in some cases a third party.

[3] Any to be redeemed (ended) by the freeholder owning land subject to such a rentcharge, work out to as of 2023[update] very roughly 10 to 11 times (based on a capitalisation rate of 4.6%) the annual rentcharge set out in the property's title, specifically per the act's formula.

[6] The act has a formula which enables Department for Communities and Local Government (DCLG) to calculate the redemption figure that the latter has to pay to redeem their rentcharge.

P = the redemption price; R = the annual amount of the rentcharge (or, as the case may be, the rent to which section 20(1) of the Landlord and Tenant Act 1927 applies) to be redeemed; Y = the maturity rate, expressed as a decimal fraction, of the “over-30-, not over 30.5-year” National Loans Fund interest rate published by the UK Debt Management Office; and N = the period, expressed in years (rounding up any part of a year to a whole year), for which the rentcharge (or, as the case may be, the rent to which section 20(1) of the Landlord and Tenant Act 1927 applies) would remain payable if it were not redeemed.

When the transaction has been completed DCLG, on behalf of the Secretary of State, issues a redemption certificate to the terre-tenant.

[8] The 1977 act retained and continues to allow developers on sale to make appropriate estate rentcharges, those: These are, thus, still a means of paying for/requiring desirable upkeep, such as ancillary communal maintenance and shared infrastructure.