Making Tax Digital for Landlords: What You Need to Know Before April 2026

easternlandlords
Sep 25
4 min read

If you earn income from property, the way you report it to HMRC is about to change. We have a guest writer this week explaining this further. Holly from Abacus Accountancy shares the following:

Seek professional assistance from an accountancy if you are unsure about the obligations around MTD — Holly Cann, Abacus Accountancy

From April 2026, landlords with annual rental and/or self-employment income over £50,000 must follow new rules under Making Tax Digital for Income Tax Self Assessment (MTD for ITSA).

This article breaks down what MTD means for landlords, who needs to comply, when, and what steps to take now to avoid last-minute stress.

What is Making Tax Digital for Income Tax?

MTD for ITSA is HMRC’s plan to modernise the tax system. Instead of filing one Self Assessment Tax Return (SATR) each year, landlords will need to:

Keep digital records of all income and expenses
Submit updates every three months using HMRC-approved software
Finalise their income and claim reliefs once a year via a “Final Declaration”

The aim is to reduce tax errors, improve cashflow visibility, and replace paper records with more efficient digital tools.

Does MTD Apply to You as a Landlord?

You’ll need to follow MTD rules from 6 April 2026 if:

You are an individual landlord (including jointly-owned property)
You file a Self Assessment tax return
Your total gross income from rental and/or self-employment is over £50,000 a year

A second wave will include those earnings over £30,000 from April 2027.

Important: This is based on your gross income, not profit. For example, £48,000 rent + £3,000 self-employed earnings = £51,000 → you must join MTD in 2026.

A key point to note is that as this is MTD for Income Tax it does not apply to income from any properties that Landlords hold in a Limited Company or as a Partnership.

It should be noted that it is the 2024/25 SATR that is submitted which will be used to determine if the Income meets the £50k threshold. HMRC will notify everyone applicable in February/March 2026, as they need to wait until the 31^st January 2026 submission deadline. If unprepared this only leaves a month to get organised!

Removal from MTD for ITSA once ‘mandated’ (the term HMRC is using if your income goes over the threshold) will only take place if it falls below the limit for 3 consecutive years.

What is the Point?

Primarily HMRC has introduced this to make Landlords (and the self-employed) keep better records throughout the year, rather than scrambling to get everything together and trying to recall transactions from a year ago.

At present no mention has been made about paying the tax on a quarterly basis, and whilst this will no doubt be a future plan to bring revenue into the Treasury quicker, due to the system changes required this is not physically possibly before 2030!

The quarterly returns will give Landlords an indication throughout the year of the likely final tax bill, so this can be planned for, rather than working it out at the end of the year.

What Will You Need to Do?

1. Keep Digital Records

Use software approved by HMRC to record income and expenses. Some banks either have or are developing software which they may issue free or for a nominal charge, and there will no doubt be other suppliers that have a compliant product before next April.

When choosing the software, speak to your Accountant if you have one, as anything free is unlikely to have had much testing, though you would hope offerings from Banks can be trusted.

Spreadsheets alone won’t be allowed unless they connect to bridging software.

Examples include:

Landlord Studio
FreeAgent
Xero
QuickBooks
Full list here

Each expense must be categorised. Mortgage interest, repairs, utilities, and letting agent fees must be logged separately.

2. Send Quarterly Updates

Every 3 months, your software will send a summary of your property income and costs to HMRC. The deadlines are:

7 August
7 November
7 February
7 May

These updates don’t include tax reliefs — you’ll do that at the end of the year.

3. Submit a Final Declaration

Once the tax year ends (on 5 April), you’ll submit a final summary via your software by the usual deadline: 31 January. This replaces your traditional tax return.

Any tax bill will become due at this point as currently – that is either in full or within the Payments on Account regime – this may change in the future but not before 2030.

MTD Timeline for Landlords

Income Threshold	Start Date
Over £50,000	April 2026
Over £30,000	April 2027
£20,000+ (TBC)	Future date

Final Thoughts

Making Tax Digital is a big change — but not a bad one. For landlords used to managing their own records or using spreadsheets, the transition to quarterly reporting may take some adjustment. But with the right software and a head start, it’s manageable. Start preparing now — and encourage fellow landlords to do the same. That way, by April 2026, MTD won’t be a shock — it’ll just be business as usual.