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MTD for Income Tax requires landlords to keep digital records and file quarterly updates with HMRC. The rules, the deadlines and the software you need.
Head of Real Estate Education and Editorial at Landlord Studio
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Making Tax Digital (MTD) for Income Tax (IT) is a major shift in how landlords and self-employed individuals report their earnings to HMRC. The initiative aims to modernise tax administration, reduce errors, and ensure a more streamlined process.
In this guide, we’ll cover everything landlords need to know about MTD for Income Tax, including key requirements, exemptions, penalties, and how to choose the right software.
MTD for Income Tax (MTD for IT) is part of the UK government’s broader plan to digitise the tax system. From April 2026, landlords and self-employed individuals with an annual income over £50,000 will be required to:
Those earning between £30,000 and £50,000 will be required to join MTD from April 2027.
Read the guide: A Closer Looks At MTD for IT Requirements
MTD for IT is being phased in with the first implementation date starting on April 6, 2026, for landlords earning £50,000+ per year. The threshold will then be lowered to £30,000+ from April 2027 and to £20,000+ from April 2028.
Quarterly updates must be submitted within a month of each quarter’s end (e.g., July 5 quarter due August 5).
A Final Declaration, confirming total income, expenses, and tax liability, is due by January 31 of the following year.
Read the guide: MTD for IT: Key Dates For Your Rental Business
Landlords enrolled in MTD for IT must submit four quarterly updates per tax year, summarising their rental income and expenses.
After submitting all updates, landlords must file a Final Declaration (due January 31) to confirm total income, expenses, and tax liabilities. This replaces the traditional Self Assessment tax return.
Read the guide: MTD for IT Quarterly Updates and Final Declarations
Some landlords may qualify for exemptions, including:
You must apply to HMRC for an exemption if you believe you qualify.
Read the guide: Making Tax Digital for Income Tax - Exemptions
HMRC is introducing a points-based penalty system for MTD for IT:
To avoid penalties, landlords must ensure they use MTD-compatible software and meet all reporting deadlines.
Read the guide: Making Tax Digital for IT Penalties
To comply with MTD for IT, landlords need HMRC-recognised software that allows them to:
Read the guide: How To Choose The Right MTD Software for Your Rental Business
Landlord Studio is an MTD software designed for landlords that pairs award winning accounting tools with property management features that will save you time and help you become MTD ready.
Create your free Landlord Studio account today to make digital record-keeping easy and MTD requirements ahead of time, generate reports, and file your self-assessment seamlessly.
Bridging software is a tool that helps landlords and businesses comply with Making Tax Digital for Income Tax (MTD for IT) by enabling them to submit their tax data to HMRC without switching to fully MTD-recognised accounting software.
Essentially, it acts as a bridge between existing spreadsheets and HMRC’s MTD system, allowing users to continue recording income and expenses in their preferred format while ensuring they meet MTD reporting requirements.
Read the guide: A Closer Look At MTD for IT Bridging Software
MTD for Income Tax is a big change, but landlords who prepare early will have a smoother transition. By understanding the requirements, key deadlines, and software requirements, you can ensure readiness while simplifying your tax reporting.
Find out how ready you are for Making Tax Digital, download the free MTD prep checklist.
In our next article, we’ll take a deeper look at what Making Tax Digital means for landlords and business owners. Stay tuned!
