Making Tax Digital for landlords

Making Tax Digital (MTD) for Income Tax Self-Assessment (ITSA), also known as Making Tax Digital for Income Tax will come into effect: 

• From April 2026 for sole traders and landlords with business or property income above £50,000 
• From April 2027 for sole traders and landlords with business or property income above £30,000
• The Government announced at the Autumn Budget that MTD will be rolled out for sole traders and landlords with business or property income between £20,000 and £30,000 'by the end of this Parliament', with more information to follow.

Read our guide about Where We Are With Making Tax Digital for further background and you can read further guidance from HMRC. 

Under Making Tax Digital, landlords will be required to send quarterly updates to HMRC, as well as a final declaration by 31st January.  

Landlords who don’t keep up to date records as part of their current record keeping may find the update difficult to handle and costly. Landlords will need to keep records in such a way that quarterly updates can be made to HMRC, whether this is through bridging software or using fully compatible software. An accountant can help you.

Landlords who own multiple properties 

Under Making Tax Digital, landlords with multiple properties will report all their UK property income together. Landlords won’t need to prepare individual quarterly reports for each UK property.  

Property income from overseas properties must also be reported under MTD, and will be reported separately to UK properties. 

Landlords with jointly-owned properties 

Where a landlord jointly owns a property, when considering when Making Tax Digital will apply from, only the individual’s share of income counts towards their qualifying income.  

Each person who has received income from a jointly-owned property will need to report their share of income to HMRC quarterly. 

If notice of their share of the income is made after expenses have been deducted, then this net amount will be considered as qualifying income.  

Proposed relaxations for landlords with jointly owned properties include: 

• for those with an annual turnover below the VAT threshold, the option to provide details of total income and expenses rather than total amounts for each category of income and expense. 
• the option to submit expenses annually rather than in each quarterly reporting of income. 

 

Date published 29 Aug 2024 | Last updated 15 Nov 2024

This article is intended to inform rather than advise and is based on legislation and practice at the time. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.

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