Making Tax Digital for Property Landlords

In this fact sheet, we’ll outline how Making Tax Digital (MTD) for income tax self assessment (ITSA) affects landlords, who may need to make changes to how they keep their property business records from April 2026.

What is MTD?

Under MTD for ITSA, businesses, self-employed individuals, and landlords will keep digital records and send a quarterly summary of their business income and expenses to HMRC using MTD-compatible software. In response, they will receive an estimated tax calculation based on the information provided to help them budget for their tax. At the end of the year, they can add any non-business information and finalise their tax affairs.

Implementation and thresholds

The implementation of MTD for ITSA will be phased in from April 2026. Now is the time to make sure you’re prepared.

From April 2026: self-employed individuals and landlords with qualifying income of £50,000 or more will be required to keep digital records and provide quarterly updates of their income and expenditure to HMRC through MTD-compatible software.

From April 2027: self-employed individuals and landlords with qualifying income of £30,000 or more will need to comply with the MTD rules.

‘Qualifying income’ is total income from self-employment and property, before expenses are deducted.

The government has stated that individuals and landlords with qualifying income of £20,000 or more will need to comply “at some point before the end of this parliament”, but no timescales for this have been published.

Keeping digital records

Under the MTD rules, business records must be kept in software that meets HMRC’s specifications.
If you have more than one business (for example, if you are a landlord and a builder), you must meet the requirements for each business.
This means you must keep separate records and make separate submissions for each business.

All properties that are:

• in the UK are treated as one ‘UK property business’.
• outside of the UK are treated as one ‘overseas property business’.

In the software, you’ll need to create records of each of your business transactions, as close to the transaction date as possible. Each quarter, the software will add together the totals for each income and expense category and send this information to HMRC. If you wish to make accounting or tax adjustments to the quarterly information, you can, but it won’t be mandatory. Instead, any adjustments and claims for tax reliefs can be made at the end of the year when you finalise the data.

There are some easements that have been announced, including those for jointly-held property income and those with turnover below the VAT registration threshold. Both of those involve less-detailed record-keeping requirements.

Benefits of digitalisation

It is worth considering moving to digital record keeping before 2026. Digital record keeping means that you don’t need to keep as much paperwork, and you’ll be able to access real-time information about your business. If these benefits interest you, please speak to us about the software options available.