Tax & Accountancy
Making Tax Digital for landlords: deadlines, dates and how to prepare
If you're a UK landlord earning over £50,000 from property or self-employment, 6 April 2026 marked the start of a significant shift in how you report your rental income to HMRC. Making Tax Digital for Income Tax is now live. For landlords who've relied on spreadsheets, paper receipts, or end-of-year accounting scrambles, this represents the biggest change to UK tax administration in decades.
This August article explains what Making Tax Digital means for landlords, who needs to comply, when the deadlines apply, and what to do now that the first phase has started.
What is Making Tax Digital?
Making Tax Digital is HMRC's initiative to modernise the UK tax system through digital technology. The programme aims to reduce errors, improve record accuracy, and provide taxpayers with real-time visibility of their tax position throughout the year rather than discovering liabilities only when filing annual returns.
For landlords, Making Tax Digital for Income Tax requires maintaining digital records and submitting quarterly updates to HMRC using compatible software. Instead of filing one Self Assessment tax return in January, you report your rental income and expenses four times per year, with a final declaration at year end.
The system builds on Making Tax Digital for VAT, which has already transformed reporting for VAT-registered businesses since 2019. Now it's the turn of landlords and sole traders to embrace digital tax administration.
When does Making Tax Digital start for landlords?
Making Tax Digital for landlords is being introduced in phases based on qualifying income thresholds. From 6 April 2026, landlords whose qualifying gross income from rental properties and self-employment exceeds £50,000 in the 2024-25 tax year are required to comply. This first phase is now live. HMRC uses the 2024-25 Self Assessment return to determine eligibility.
Not sure whether you are in scope? Our MTD calculator for landlords estimates your indicative start year based on your gross property and self-employment income, alongside your likely tax position and quarterly update obligations.
The rollout continues in subsequent years:
6 April 2027 — landlords with qualifying income over £30,000 must join.
6 April 2028 — the threshold reduces to £20,000.
It's crucial to understand that qualifying income refers to your gross rental income before expenses, combined with any self-employment income. Employment income, pensions, and dividends don't count towards this threshold. If you jointly own property, only your share of the rent counts.
HMRC notified eligible landlords between February and March 2026, after the 31 January Self Assessment deadline. If you did not receive a notification and believe you meet the threshold, contact HMRC directly, you are still required to comply regardless of whether a letter arrived.
Making Tax Digital deadlines: the key dates for landlords
The MTD for Income Tax deadlines are staggered by income threshold. Here is the full timeline.
6 April 2026 — MTD for Income Tax went live for landlords with qualifying gross income above £50,000 in 2024/25. This phase is now under way.
6 April 2027 — The threshold reduces to £30,000. Landlords with qualifying income between £30,000 and £50,000 must join MTD.
6 April 2028 — The threshold reduces further to £20,000.
Quarterly submission deadlines — submissions are due on 7 August, 7 November, 7 February, and 7 May each year, covering the four quarterly periods. The first submission for the 2026/27 tax year, covering 6 April to 5 July 2026, is due by 7 August 2026.
31 January — The final declaration deadline remains unchanged. After your fourth quarterly update, you submit a final declaration by 31 January confirming all income for the tax year. The first final declaration for the 2026/27 tax year is due 31 January 2028.
Soft landing for 2026/27: HMRC has confirmed that no penalty points will be issued for late quarterly submissions during the 2026/27 tax year, the first year of MTD for those joining in April 2026. This soft landing applies only to quarterly updates, not to the Final Declaration (due 31 January 2028) or to late payment penalties, which run under a separate regime. The soft landing applies only to the first cohort entering MTD in April 2026 and will not extend to landlords joining from April 2027 onwards.
If you are not yet sure whether you meet the threshold, use the August rental income tax calculator to estimate your qualifying gross income and see your indicative MTD start date. The MTD guide for landlords covers how qualifying income is calculated in full.
What Making Tax Digital means for landlords
Making Tax Digital fundamentally changes three aspects of tax management for landlords: record-keeping, reporting frequency, and software requirements.
Digital record-keeping becomes mandatory
You must keep digital records of all rental income and expenses using Making Tax Digital-compatible software. While you don't need to keep digital copies of receipts and invoices as long as the information is recorded in digital records, the days of paper-based bookkeeping are ending for affected landlords.
Your digital records must include:
All rental income received.
Allowable expenses paid.
Details of assets and liabilities.
Mileage logs for property-related travel — our mileage expense calculator makes maintaining compliant mileage records straightforward, mapping routes between postcodes, applying the correct HMRC rates, and giving you a clear figure to record for each property visit.
Bank statements and transaction records.
These records must be preserved digitally for at least seven years. Modern landlord software makes this straightforward, with document storage and automated categorisation replacing manual filing systems.
Quarterly reporting replaces annual returns
Instead of one annual Self Assessment, landlords must submit a summary of income and expenses to HMRC every three months. The quarters align with:
6 April to 5 July (due 7 August)
6 July to 5 October (due 7 November)
6 October to 5 January (due 7 February)
6 January to 5 April (due 7 May)
If you have both rental income and sole trader income, you'll need separate quarterly updates for each. This means up to eight submissions per year. Overseas rental income must also be reported separately.
Quarterly updates can be prepared on a cash basis, so there's no need to deal with accruals or prepayments until your final year-end return.
After your fourth quarterly update, you'll complete a final declaration. This replaces the traditional Self Assessment tax return, confirms all income for the year, and includes other income sources like employment, bank interest, or dividends. The submission and payment deadlines remain 31 January, maintaining continuity with current practice. Note that tax payment dates do not change under MTD, you still pay on 31 January and 31 July as before.
Making Tax Digital compatible software is required
You cannot submit quarterly updates or your final declaration using paper forms or basic spreadsheets. MTD requires landlords to keep financial records and complete submissions using compatible software.
HMRC maintains a list of approved MTD software for landlords. Options range from general accounting packages like Xero, QuickBooks, and Sage to landlord-specific platforms. For a full breakdown of the available options including free tiers and bridging software, see our guide to the best MTD software for landlords. For small landlords managing rental property alongside other commitments, choosing software designed for your needs matters.
August is built specifically for UK landlords, combining rent tracking, compliance management, and document storage in one intuitive app. The app keeps digital records in HMRC-aligned categories and supports quarterly MTD updates. You can download August and ensure your records are properly structured ahead of each quarterly deadline.
How does Making Tax Digital work in practice?
Throughout the tax year, you use your chosen Making Tax Digital software to record every transaction, rent received, maintenance costs, insurance premiums, allowable expenses, and so on. Your landlord software keeps these records digitally and securely.
Our Making Tax Digital calculator gives you an early view of your tax position, blending your rental profit, self-employment income, and other taxable income to show your tax band, approximate liability, and illustrative payments on account.
At the end of each quarter, you submit a summary to HMRC directly through the software. This is an update on your income and expenses for the period. The HMRC-compatible landlord software provides a real-time tax estimate based on the information entered, giving you visibility of your likely tax position throughout the year.
After four quarterly updates, you complete a final declaration, which pulls together all your quarterly data, adds any other income sources, and produces your definitive tax bill.
For landlords below the £90,000 income threshold, simplified reporting is available. Rather than itemising every expense category, you can report total income and total expenses, reducing administrative burden while maintaining compliance.
What Making Tax Digital means for accountants
If you use an accountant, Making Tax Digital affects your relationship and workflow. Accountants can access Making Tax Digital-compatible software and submit quarterly updates on your behalf, but the underlying responsibility for accurate record-keeping remains yours.
The shift to quarterly reporting means more frequent touchpoints with your accountant throughout the year, rather than the traditional single year-end meeting. This creates opportunities for better tax planning and early identification of issues, but it also means accounting fees may adjust to reflect the increased workload.
If you haven't already had this conversation with your accountant, do so now. Clarify who will handle quarterly submissions, what information they'll need from you, and how often you'll communicate throughout the year.
Who is exempt from Making Tax Digital?
Not every landlord with rental income falls within Making Tax Digital's scope. Key exemptions include:
Property held in limited companies - Making Tax Digital for Income Tax applies only to unincorporated landlords. If your rental property sits within a limited company structure, you're not affected.
Partnerships - Partnership entities are exempt from the current rollout, though individual partners with separate rental businesses may still need to comply based on their personal qualifying income.
Ministers of religion, Lloyd's underwriters - These groups won't be required to join MTD during this Parliament.
Digital exclusion - If you can demonstrate it's not reasonably practical to use digital tools due to age, disability, remoteness of location, or religious beliefs, you may apply to HMRC for an exemption.
If you believe you qualify for an exemption, you must apply to HMRC, which will assess eligibility on a case-by-case basis.
Getting MTD right now it has started
MTD for Income Tax is live. If you meet the £50,000 threshold, your first quarterly submission covers 6 April to 5 July 2026 and is due by 7 August 2026. Here is what to do now.
Confirm whether you are in scope
Review your 2024-25 gross rental income and self-employment income. If the combined figure exceeds £50,000, you are in the first wave and MTD applies to you now. Use August's expense tracking to maintain clear digital records going forward. If you are between £30,000 and £50,000, you have until April 2027, use the time to set up digital records so the transition is seamless when your phase begins.
Choose Making Tax Digital software
Research Making Tax Digital-compatible options and select software that matches your portfolio size and complexity. For self-managing landlords with one to ten properties, integrated platforms like August offer everything you need without overwhelming features designed for letting agents. See our guide to the best MTD software for landlords for a full comparison.
Digitise your existing records
If you currently use paper records or basic spreadsheets, migrate to digital systems now. Upload your tenancy agreements, Gas Safety Certificates, EICR certificates, EPC ratings, and insurance documents. August makes this straightforward with unlimited document storage and smart reminders for renewal dates.
Register for Making Tax Digital
You are not automatically registered, even if you already use MTD for VAT or are registered for Self Assessment. If you have not yet registered, do so immediately — your first quarterly deadline is 7 August 2026. Registration is done through your Government Gateway account or via your accountant.
Speak to your accountant
If you use an accountant, clarify who will handle quarterly submissions, what information they'll need from you, and how often you'll communicate. If you self-file, consider whether you want professional support for at least the first year of Making Tax Digital compliance.
Build good quarterly habits now
Record income and expenses throughout each quarter rather than catching up before the deadline. This produces more accurate submissions and removes end-of-quarter stress. The August app guides you through setting up properties, recording transactions, and staying on top of compliance tasks throughout the year.
Making Tax Digital and your broader compliance picture
Making Tax Digital doesn't exist in isolation. It's one element of your overall regulatory and administrative burden as a landlord. While adapting to quarterly reporting, don't lose sight of your other obligations:
Right to Rent checks for new tenancies.
Annual Gas Safety inspections.
Five-yearly Electrical Installation Condition Reports.
Energy Performance Certificate renewals.
HMO licensing requirements where applicable.
Deposit protection and prescribed information.
Tenancy deposit return procedures.
From 1 May 2026, the Renters' Rights Act also adds new compliance obligations around tenancy terms, rent increases via Section 13 Form 4A, and written statements. August's compliance checklist keeps all of these requirements visible in one place, with step-by-step guidance and suggested reminders so nothing falls through the cracks.
The bigger picture: why Making Tax Digital matters
HMRC estimates around 780,000 people with business or property income over £50,000 joined the MTD for ITSA service from April 2026, with a further 970,000 joining from April 2027.
The government's aim is straightforward. To reduce the tax gap, improve compliance, and modernise an outdated system. For landlords, the benefits include better financial visibility, fewer surprises at tax time, and reduced risk of errors that trigger penalties or investigations.
The transition requires investment in time, software, and possibly professional fees. Landlords who approach Making Tax Digital as an opportunity to streamline their administration, rather than just another compliance burden, tend to find the benefits outweigh the costs. Quarterly reporting means your tax position is visible throughout the year, not just in January.
What happens if you don't comply with Making Tax Digital?
Non-compliance with Making Tax Digital carries a points-based penalty system. Each missed quarterly submission or missed final declaration earns one penalty point. Once you accumulate four points, a £200 penalty is triggered, with further £200 penalties for each subsequent late submission until your points are reset. Points are reset after 24 months of sustained compliance, provided all outstanding submissions have been received by HMRC.
Importantly, the soft landing for 2026/27 means no penalty points will be issued for late quarterly submissions during the first year, but this does not apply to the Final Declaration or to late payment of tax. Interest runs on unpaid tax from the payment due date regardless.
Without digital records and proper software, you also lose the real-time visibility of your tax position that Making Tax Digital provides, increasing the risk of cash flow problems and unexpected tax bills.
Moving forward with confidence
Making Tax Digital for landlords is now under way, but it is manageable. The key is establishing good habits now, recording income and expenses digitally throughout each quarter, not scrambling before each deadline.
If you are already within MTD, your first quarterly deadline is 7 August 2026. Review your records for the period 6 April to 5 July 2026, ensure your software is connected to HMRC, and submit on time. The soft landing means no penalty points will be issued for late quarterly submissions in 2026/27, but submitting on time from the start is the better habit to build.
If you are not yet in scope but will be from April 2027 or April 2028, use the intervening time to choose your software, digitise your records, and build the quarterly record-keeping habits that will make compliance straightforward when your phase begins.
For small landlords balancing rental property alongside other commitments, integrated solutions like August remove friction from the process. Instead of juggling separate tools for rent tracking, document management, compliance management, and expense recording, everything sits in one intuitive app designed specifically for UK landlords. The August Intelligence assistant can answer questions about your properties, scan tenancy agreements to auto-fill details, and suggest reminders based on your uploaded documents.
If you want to understand the best digital landlord approach to running your portfolio in 2026, combining MTD-ready record-keeping, Open Banking rent tracking, and compliance management in a single operation, our guide covers the full model.
Interested in developing a partnership with August?
Disclaimer: This article is a guide and not intended to be relied upon as legal or professional advice, or as a substitute for it. August does not accept any liability for any errors, omissions or misstatements contained in this article. Always speak to a suitably qualified professional if you require specific advice or information.
Author
August Team
The August editorial team lives and breathes rental property. They work closely with a panel of experienced landlords and industry partners across the UK, turning real-world portfolio and tenancy experience into clear, practical guidance for small landlords.
