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Making Tax Digital for Landlords

What MTD means for your UK Rental Income

Learn how Making Tax Digital affects landlords. Find out when MTD for rental income begins and what property owners must do to stay compliant.

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If you’re a landlord in the UK, Making Tax Digital (MTD) will soon change how you report your rental income to HMRC. MTD for Income Tax Self Assessment (ITSA) is set to roll out in stages, and landlords with rental income above certain thresholds will need to comply.

This guide explains what Making Tax Digital for landlords means, who it applies to, and how you can prepare to stay compliant and penalty-free.

Does MTD Apply to Landlords?

Yes. Making Tax Digital for Income Tax Self-Assessment (MTD for ITSA) will affect landlords in phases, starting with those on higher incomes. If you earn rental income above the thresholds below, you’ll need to keep digital records and report quarterly using HMRC-recognised software:

Start DateWho It Affects
April 2026Landlords with rental income over £50,000
April 2027Landlords with rental income over £30,000

A few key points landlords should be aware of:

  • Income from multiple properties is combined – if you let out more than one property, HMRC looks at your total gross rental income, not each property separately.
  • Below £30,000? – landlords with annual rental income under £30,000 are not currently within scope. However, HMRC has left the door open to expand MTD in future, so early preparation is still wise.

At Accounting Wise, we’re already helping landlords prepare for MTD by setting up digital record-keeping systems, advising on allowable expenses, and ensuring compliance well ahead of the deadlines.

What Do Landlords Need to Do Under MTD?

If you’re a landlord within scope of MTD for Income Tax, your reporting obligations will change significantly. Instead of one annual Self-Assessment return for your property income, you’ll need to manage digital records and multiple submissions throughout the year. Specifically, you must:

  • Keep digital records – all rental income and allowable expenses must be recorded in MTD-compatible software. Paper records and spreadsheets alone will no longer be accepted by HMRC.
  • Submit quarterly updates – every three months, you’ll send a summary of your property income and expenses to HMRC through approved software.
  • Complete an End of Period Statement (EOPS) – after the tax year ends, you’ll confirm your figures, apply reliefs, and make adjustments where needed.
  • Submit a Final Declaration – this replaces the traditional Self Assessment return and confirms your total taxable income (including property and any other sources).

In practice, MTD means landlords will be making five digital submissions per year instead of one. While this sounds like more admin, the right software and professional support can make the process smooth and even give you clearer insight into your rental business performance.

What Software Do Landlords Need?

To comply with Making Tax Digital, landlords must use MTD-compatible software that links directly to HMRC. The right solution will allow you to:

  • Record rental income and expenses in real time.
  • Categorise allowable deductions correctly (e.g. mortgage interest, repairs, letting agent or management fees).
  • Submit quarterly updates and end-of-year declarations
  • Connect directly with HMRC to ensure your submissions are valid and on time.

Recommended Software Options for Landlords

  • FreeAgent – simple and affordable, ideal for small landlords or those with just one or two properties.
  • Xero or QuickBooks – robust, flexible platforms well-suited to landlords with multiple properties or more complex finances.
  • Bridging software – an option if you still use spreadsheets, though best seen as a temporary measure rather than a long-term solution.

Cloud-based accounting software is strongly recommended by HMRC and by Accounting Wise, as it not only ensures compliance but also provides valuable financial insights to help you manage your rental business more effectively.

Quarterly Update Deadlines for Landlords

Once you’re within scope of Making Tax Digital, HMRC requires landlords to submit quarterly updates throughout the tax year. These reports summarise your rental income and expenses and must be filed through approved MTD software.

Period CoveredDeadline
6 April – 5 July5 August
6 July – 5 October5 November
6 October – 5 January5 February
6 January – 5 April5 May

After your accounting year ends, you’ll also need to:

  • File your End of Period Statement (EOPS) – confirming your property income and making any adjustments or relief claims.
  • Submit your Final Declaration – replacing the traditional Self Assessment return, due by 31 January following the end of the tax year.

In practice, this means landlords will be making five submissions to HMRC every year instead of just one. With the right systems in place, however, the process becomes routine and can even give you greater visibility over your rental business.

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MTD Quick Links

What is Making Tax Digital
Do I Need to Register for Making Tax Digital?
Making Tax Digital Timeline and Rollout
How to Sign Up for Making Tax Digital
Making Tax Digital Deadlines and Dates
Making Tax Digital for VAT
MTD Income Tax (MTD for ITSA)
Making Tax Digital for Corporation Tax
Making Tax Digital Exemptions
Common MTD Mistakes and Avoiding Them
Making Tax Digital for Partnerships
Making Tax Digital for Limited Companies
Making Tax Digital for Sole Traders
Making Tax Digital for Landlords
Making Tax Digital Compliant Software
Making Tax Digital Bridging Software
How Accountants Can Help with MTD

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What Happens If You Landlords Comply?

Failing to meet your Making Tax Digital obligations can have serious consequences for landlords. HMRC has introduced a points-based penalty system, where each missed or late submission builds up penalty points. Once you exceed the threshold, financial fines apply.

Other risks include:

  • Incorrect tax calculations – missed or inaccurate updates can lead to the wrong tax being assessed, creating unexpected bills or repayments.
  • Rejected filings – returns not submitted through MTD-compatible software will no longer be accepted by HMRC.
  • Increased scrutiny – repeated non-compliance may raise red flags and trigger HMRC checks or audits.

Preparing early ensures you avoid penalties, keep your tax records accurate, and reduce the stress of last-minute filing.

Can Landlords Be Exempt from MTD?

Yes while most landlords will be required to comply, HMRC recognises that some individuals may be unable to meet the digital requirements. You may qualify for an exemption if:

  • You are digitally excluded due to age, disability, or lack of internet access in your area.
  • You have religious beliefs that prevent you from using computers or digital technology.
  • Your rental income is below the MTD thresholds (£30,000 per year, as of current rules).

To claim an exemption, you must apply directly to HMRC and provide supporting evidence. For a step-by-step guide, see our [MTD Exemptions and Deferrals Guide].

At Accounting Wise, we can assess whether you qualify for an exemption and help prepare your application, ensuring you’re fully protected.

Benefits of MTD for Landlords

While Making Tax Digital introduces more frequent reporting, it also offers clear benefits for landlords who embrace the change. By adopting digital systems, you can:

  • Gain real-time insight into your tax position – no more surprises at year-end; you’ll know where you stand financially throughout the year.
  • Stay organised with your property income and expenses – digital record-keeping makes it easy to track rental payments, repairs, mortgage interest, and management fees.
  • Reduce errors and maximise deductions – automated categorisation helps you claim all allowable expenses correctly, improving tax efficiency.
  • Eliminate year-end stress – quarterly submissions spread the workload and prevent the January rush to file a year’s worth of paperwork.

With the right software and expert support, MTD can do more than just keep you compliant it can streamline the way you manage your rental business and give you greater confidence in your finances.

Accounting Wise - Benefits of MTD for UK Landlords

How Accounting Wise Can Help UK Landlords

At Accounting Wise, we specialise in guiding landlords through the transition to Making Tax Digital. Whether you let out a single property or manage a large portfolio, our tailored support ensures you stay compliant without adding unnecessary stress.

Our services include:

  • Software setup and training – we’ll get you started with the right MTD-compatible tools and show you how to use them with confidence.
  • Digital record-keeping support – from categorising expenses to tracking rental income, we’ll make sure your records meet HMRC’s standards.
  • Quarterly update submissions – we’ll prepare and file your reports on time, every time.
  • EOPS and Final Declaration filing – full year-end support to keep you compliant and accurate.
  • Ongoing compliance and property tax advice – helping you manage deductions, reliefs, and long-term planning.

Whether you’re a part-time landlord or a full-time property investor, we make MTD simple.

Get MTD-Ready as a Landlord

Making Tax Digital for landlords is approaching quickly. If your rental income is over £30,000, the time to prepare is now. Starting early means fewer headaches, no last-minute panic, and peace of mind that you’re fully compliant.

Contact Accounting Wise today to get MTD-ready for your rental income  the easy way.

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Making Tax Digital for Landlords FAQ

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Yes but only if your property income is above the MTD threshold. From April 2026, landlords with annual rental income over £50,000 must keep digital records and file quarterly updates with HMRC. From April 2027, this will extend to landlords earning between £30,000 and £50,000.

MTD for landlords means you will no longer file a single annual Self Assessment tax return. Instead, you must:

  • Keep digital records of rental income and expenses
  • Submit quarterly updates to HMRC through MTD-compatible software
  • Submit an end of period statement (EOPS) to confirm the year’s totals
  • Submit a final declaration, which replaces the Self Assessment return

MTD applies to:

  • Individual landlords with residential or commercial property income above the threshold
  • Non-resident landlords with UK rental income above the threshold

It does not currently apply to limited companies holding property (these continue under Corporation Tax rules, and MTD for CT has been cancelled).

Landlords must use HMRC-recognised MTD-compatible software to record income and expenses and send quarterly updates. Common options include Xero, QuickBooks, Sage, FreeAgent, and The Balance App, many of which can link directly to bank feeds for easier tracking of rental income and costs.

Yes, but only with “bridging software” that connects spreadsheets to HMRC’s systems. While possible, this method can be cumbersome. Most landlords benefit from switching to full cloud accounting software, which simplifies quarterly updates and ensures compliance.

Failure to comply may result in:

  • Inability to file required returns (as HMRC will not accept non-digital submissions)
  • Penalties for late or missed filings
  • Increased compliance scrutiny from HMRC

Using MTD-compliant software reduces these risks and keeps your reporting smooth.

Landlords can prepare by:

  • Moving rental records into cloud accounting software
  • Separating personal and rental expenses clearly
  • Getting used to quarterly reporting ahead of time

Working with an accountant to ensure the right setup and avoid compliance issues

At Accounting Wise, we support landlords by:

  • Setting up MTD-compatible software tailored to property income
  • Migrating and organising records for digital reporting
  • Managing quarterly submissions and year-end statements
  • Providing tax advice to ensure landlords maximise allowable deductions while staying fully compliant

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Accounting Wise is a trading style of Accounting Wise Ltd, a limited company registered in England under company number 09365202. Our registered office is: The Carriages, Station Road, Ware, SG12 9PL UK.

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