Making Tax Digital · Landlord guide · Updated May 2026
MTD for landlords: the complete guide to Making Tax Digital Income Tax.
Written by Iftikhar Rashid FCCA — Managing Partner, RR Accountants. 16 years in practice, specialist in property and landlord tax.
What is MTD for landlords?
Making Tax Digital for Income Tax (MTD ITSA) requires UK landlords with gross rental income above £50,000 to keep digital records and submit four quarterly updates to HMRC per year, starting April 2026. A final declaration replaces the traditional self-assessment return. Landlords below £30,000 gross are currently exempt. Properties held in a limited company are not affected — they follow corporation tax rules. [VERIFY: thresholds at gov.uk/making-tax-digital]
MTD Income Tax thresholds for landlords
Thresholds based on gross income — total receipts before deductions. [VERIFY all figures at gov.uk]
| Start date | Who must comply | Gross threshold |
|---|---|---|
| April 2026 ✓ Live now | Landlords & sole traders | Above £50,000/year [VERIFY] |
| April 2027 | Landlords & sole traders | Above £30,000/year [VERIFY] |
| Not yet confirmed | Below £30,000 | Exempt for now [VERIFY] |
Combined gross income (rental + self-employment) is added together when assessing the threshold. Properties held in a limited company do not count.
What MTD for Income Tax requires from landlords
Digital records
All rental income and property expenses must be recorded digitally throughout the year using HMRC-approved software. Paper records and unsupported spreadsheets are not permitted.
Quarterly submissions
Four updates per year submitted to HMRC summarising income and expenses for each quarter. Deadlines are approximately 7 August, 7 November, 7 February, and 7 May. [VERIFY]
Final declaration
Replaces the traditional SA100 self-assessment return. Submitted by 31 January following the tax year. Confirms total income, allowances, and any adjustments. [VERIFY]
Which landlords does MTD apply to?
✓ MTD applies to
- ✓Landlords with gross rental income above £50,000 [VERIFY]
- ✓Sole traders with gross income above £50,000 [VERIFY]
- ✓Combined rental + self-employment income above £50,000 [VERIFY]
- ✓Landlords approaching the £50,000 threshold
- ✓Anyone who currently files self-assessment for property income
✕ MTD does not apply to
- ✕Landlords with gross income below £30,000 (currently exempt) [VERIFY]
- ✕Properties held in a limited company (SPV) — these follow corporation tax
- ✕Overseas landlords on non-UK income
- ✕Income from furnished holiday lets (rules differ — seek advice)
What software do landlords need for MTD?
You need HMRC-recognised MTD-compatible software that maintains a digital link from your records to the submission. You cannot submit directly through HMRC's own portal.
Xero
Full cloud accounting — best for landlords with multiple properties or an SPV.
FreeAgent
Clean interface, HMRC-integrated. Good for straightforward portfolios.
QuickBooks
Widely used, strong MTD bridge, suitable for combined business + rental income.
Property management software + bridge
Some landlords use specialist tools (e.g. Arthur, Landlord Vision) with an MTD bridging product.
We set up and manage MTD-compatible software for every client. You do not need to configure it yourself — onboarding includes software setup, HMRC connection, and a walkthrough of the quarterly cadence.
MTD penalties for landlords
[VERIFY all penalty figures at gov.uk before publishing]
| Failure | Consequence [VERIFY] |
|---|---|
| Missed quarterly submission | 1 penalty point per missed submission |
| 4 penalty points accumulated | £200 fixed penalty triggered [VERIFY] |
| Continued non-compliance beyond point threshold | Further penalties per missed submission [VERIFY] |
| Penalty points lifespan | Points last 24 months [VERIFY] |
| Late payment of tax due | Separate late payment penalties apply [VERIFY] |
We track penalty points for every MTD client and submit before every deadline. No client should ever accumulate points.
MTD for landlords — frequently asked questions
What is Making Tax Digital for Income Tax (MTD ITSA)?
Making Tax Digital for Income Tax Self Assessment (MTD ITSA) is HMRC's requirement for landlords and sole traders to keep digital records and submit four quarterly updates per year, replacing the annual self-assessment return for income above the threshold. It started April 2026 for those with gross income above £50,000. [VERIFY: current thresholds and start dates at gov.uk/topic/business-tax/making-tax-digital]
Which landlords must register for MTD Income Tax?
Landlords with gross property income above £50,000 per year must comply from April 2026. From April 2027, the threshold drops to £30,000 gross. Gross income means total rental receipts before any deductions or expenses. Combined gross income (rental plus self-employment) is added together to assess the threshold. [VERIFY: current thresholds at gov.uk]
What does MTD for landlords require in practice?
MTD requires three things: (1) keep digital records of rental income and expenses throughout the year using MTD-compatible software; (2) submit four quarterly updates to HMRC summarising income and expenses; (3) submit a final declaration by 31 January, replacing the traditional SA100 tax return. You cannot use paper records or unsupported spreadsheets alone.
What are the quarterly submission deadlines for landlords?
Quarterly submissions are due approximately one month after each quarter ends — typically 7 August, 7 November, 7 February, and 7 May. The exact dates depend on your accounting period. A final declaration is due by 31 January following the tax year. [VERIFY: exact quarterly deadlines at gov.uk]
What software do landlords need for MTD?
You need HMRC-recognised MTD-compatible software with digital links — typically Xero, FreeAgent, QuickBooks, or a bridging product. Landlords with straightforward portfolios often use specialist property software with an MTD bridge. Standalone spreadsheets are not permitted. We set up and manage the software for every MTD client.
What are the MTD penalties for landlords?
MTD uses a points-based penalty system. Each missed quarterly submission earns one point. Accumulating four points within 24 months triggers a £200 penalty, plus additional penalties for ongoing non-compliance. Separate late payment penalties apply to any tax due. [VERIFY: current penalty rates and point thresholds at gov.uk]
Do landlords with properties in a limited company need to comply with MTD?
No. Properties held through a limited company (SPV) are subject to corporation tax, not income tax. MTD ITSA applies only to personally held rental income. If you hold some properties personally and some through an SPV, only the personal rental income counts towards the MTD threshold.
How do I prepare my rental portfolio for MTD?
The four steps are: (1) confirm whether your gross income is above the threshold; (2) choose and set up MTD-compatible software; (3) establish a digital record-keeping routine for income and expenses; (4) register with HMRC for MTD ITSA before your first quarterly deadline. We handle all four steps for clients we onboard before their first submission date.
Related guides and services
- MTD Income Tax service — book a call
- Accountants for UK landlords
- Section 24 — mortgage interest restriction
- SPV vs personal name — which is right?
- Self Assessment for landlords
- Capital Gains Tax calculator
MTD is live now
Need help with MTD for your rental portfolio?
We prepare affected landlords from assessment through to first submission. Book a 20-minute call — we will confirm whether you are in scope and what the setup looks like.
Book a call →Iftikhar Rashid FCCA · 16 years · Specialist in landlord tax