Making Tax Digital for Landlords: What You Need to Do (2026–27 Guide)

By Jorge Ruete Veramendi · Last updated 8 November 2026

In short: Making Tax Digital (MTD) for Income Tax means landlords keep digital records and send HMRC a short summary of their rental income and expenses every three months, using HMRC-recognised software. Making Tax Digital applies to you if your rental and self-employment income, before expenses, is above £50,000 (from April 2026), £30,000 (from April 2027) or £20,000 (from April 2028).

What is Making Tax Digital for landlords?

Making Tax Digital for Income Tax is HMRC’s new way of reporting income from property and self-employment. Instead of one tax return a year, you keep digital records and send four quarterly updates, then a tax return at the end of the year.

What changes compared with Self Assessment as you know it:

• Digital records: you record rent and expenses in software (or a spreadsheet linked to bridging software), not on paper.
• Quarterly updates: every three months, your software sends HMRC a summary of your income and expenses. You don’t pay tax every quarter.
• Year-end tax return: you still submit a tax return after the end of the tax year, now through your software.

Does Making Tax Digital apply to me?

You need to use Making Tax Digital if you are a landlord or sole trader registered for Self Assessment and your qualifying income is above the threshold for that year.

What counts as qualifying income

Qualifying income is your total income from property and self-employment, before expenses (your turnover, not your profit). All your property and self-employment income is added together.

Qualifying income does not include wages from a job (PAYE), the State Pension, private pensions or dividends.

Two examples:

• Sarah has a full-time job paying £45,000 and rents out one flat for £14,400 a year. Her qualifying income is £14,400, because her salary doesn’t count. She doesn’t need MTD in 2026, 2027 or 2028 unless her rental income grows.
• Tom owns three buy-to-let houses that bring in £34,000 a year in rent. After mortgage interest and repairs, his profit is much lower, but MTD looks at income before expenses. His qualifying income is £34,000, so he must use MTD from 6 April 2027.

Jointly owned property

Only your share of the income counts. If you and your partner own a flat 50:50 that brings in £40,000 a year, each of you has £20,000 of qualifying income from it.

Will HMRC tell me?

HMRC checks your Self Assessment return each year and writes to you if you are above the threshold. Even if no letter arrives, it is still your responsibility to check whether you need to use MTD.

Key dates and deadlines

Each quarterly update has a deadline on the 7th of the month after the quarter ends. The deadlines are the same whether you use standard quarters (starting 6 April) or calendar quarters (starting 1 April).

Each update is cumulative: it covers the tax year so far, so you can correct earlier figures in the next update. After the fourth update, you submit your tax return through your software.

What you need to do: step by step

1. Work out your qualifying income using your last Self Assessment return (rent plus any self-employment income, before expenses).
2. Choose HMRC-recognised software that supports property income. See what software landlords need below.
3. Sign up for Making Tax Digital with HMRC. You must be registered for Self Assessment and still submit your Self Assessment return for the tax year before you start.
4. Keep digital records of every rent payment and expense from the day you start.
5. Send your quarterly updates through your software by each deadline.
6. Submit your tax return through your software after the end of the tax year.

What software do landlords need?

You need software that is recognised by HMRC for Making Tax Digital for Income Tax and that supports UK property income. There are two types:

• Full accounting software: you record everything in the software and it sends your updates to HMRC. Often includes bank feeds and receipt capture.
• Bridging software: you keep using your own spreadsheet, and the bridging software connects it to HMRC.

Several MTD tools offer free plans for landlords with one to three properties. Before you choose, check that the software also submits your year-end tax return, not just the quarterly updates. Without that feature, you’ll need a second tool.

👉 Compare HMRC-recognised options in our MTD software for landlords comparison, built with our public method.

Exemptions and special cases

HMRC can exempt landlords who are digitally excluded, meaning it isn’t reasonable for them to use software. Accepted reasons include your age, a health condition or disability, or no internet access at home because of your location. You usually need to apply to HMRC for this exemption.

HMRC won’t accept these reasons on their own: being unfamiliar with software, having only a few records, or the extra time or cost. If you get an exemption, you still send a normal Self Assessment tax return.

Partnerships don’t need to use Making Tax Digital for Income Tax yet. HMRC will confirm a start date later.

Penalties

Making Tax Digital uses a points-based system for late submissions:

• 2026 to 2027: HMRC will not apply penalty points for late quarterly updates. Points still apply to a late tax return.
• From 2027 to 2028: each late quarterly update or tax return earns a point. When you reach 4 points, you get a £200 penalty.

Paying tax late has separate penalties, which grow the longer the tax stays unpaid.

The bottom line

If your rental and self-employment income before expenses is over £30,000, you have until 6 April 2027 to choose software, sign up and start keeping digital records. Starting a few months early, with a free trial, is the easiest way to avoid stress in your first quarter.

This is general information, not tax advice. Check the official guidance on GOV.UK or speak to a qualified accountant about your situation.