Making Tax Digital for limited company landlords

Making Tax Digital for Income Tax does not apply to property you hold through a limited company. A company pays Corporation Tax on its rental profits, and Corporation Tax sits entirely outside Making Tax Digital. HMRC confirmed in its Transformation Roadmap of 21 July 2025 that it will not introduce Making Tax Digital for Corporation Tax, and it has set no future date. So a limited company landlord has no obligation to keep MTD digital records or file quarterly updates for company property income. Two things still matter, though: Making Tax Digital for Income Tax can reach you personally on income you hold outside the company, and the way companies file Corporation Tax changed in April 2026.

Which taxes does Making Tax Digital actually cover?

Making Tax Digital is not one rule but three separate regimes, and only one of them can touch a limited company landlord. For Corporation Tax, there is no Making Tax Digital requirement and no timetable for one. For Income Tax, Making Tax Digital for Income Tax Self Assessment began on 6 April 2026, but it applies to individuals and sole traders, not to companies, so it never reaches income held inside a limited company. For VAT, Making Tax Digital for VAT remains mandatory, but only for businesses that are VAT-registered, which most residential landlords are not. The practical result is that a landlord who holds property solely through a company has no Making Tax Digital duty for that property at all.

Why company property income sits outside MTD for Income Tax

Company property income is excluded from the Making Tax Digital for Income Tax threshold entirely. Making Tax Digital for Income Tax is phased in by qualifying income: from 6 April 2026 for individuals with gross income over £50,000 in the 2024 to 2025 tax year, dropping to £30,000 from April 2027 and £20,000 from April 2028. Qualifying income means an individual's gross rental and self-employment receipts before expenses. Rent earned by a company is the company's income, not the individual's, so it does not count towards that threshold and cannot pull a director into Making Tax Digital for Income Tax. The full phasing is set out in the gov.uk guidance on Making Tax Digital for Income Tax, and in the August Making Tax Digital guide.

When MTD for Income Tax can still apply to you personally

Making Tax Digital for Income Tax can still apply to a company director, but only to income held in their own name, never to the company's. Salary and dividends drawn from your company are not qualifying income and never trigger Making Tax Digital. However, if you also let property in your own name, or run a separate self-employment, Making Tax Digital as an individual landlord may apply to that income where it exceeds the threshold.

Consider a landlord who holds three buy-to-lets in a company and one flat personally. The company's rents pass through the CT600 and stay outside Making Tax Digital. The personal flat's rent is measured against the qualifying income threshold on its own. If that personal gross rent, combined with any self-employment income, exceeds £50,000, the landlord must keep digital records and file quarterly updates for the personal income, while the company continues to file annually. In our experience supporting landlords who run mixed structures, this split is the single most misunderstood point, because the letter from HMRC lands personally and gives no hint that the company income should be left out of the calculation. Where personal income is in scope, you can estimate the personal tax due on that income before you file.

What limited company landlords must do instead

A limited company reports its rental profits through an annual Company Tax Return, the CT600, not through quarterly Making Tax Digital updates. The company files the CT600 with HMRC within twelve months of the end of its accounting period, files statutory accounts with Companies House, and pays Corporation Tax nine months and one day after the accounting period ends. Late filing carries penalties that begin at £100 and escalate with continued delay, so the annual deadline still demands the same discipline that quarterly reporting would.

One change did land in 2026. HMRC's free Company Accounts and Tax Online filing service closed permanently on 31 March 2026. From 1 April 2026, every limited company must file its CT600 and accounts using commercial software rather than the old free HMRC and Companies House portal. A company landlord who used to self-file for nothing now needs either an accountant or approved software to submit. Whichever route you take, the return is only as clean as the records behind it, and it pays to keep your company's property records and expenses in order throughout the year rather than reconstructing them at the year end. Landlords who run their company books in real time consistently report a faster, cheaper year-end than those who hand their accountant a shoebox.

Making Tax Digital for VAT and limited companies

Making Tax Digital for VAT applies to a company only where the company is VAT-registered, which most residential landlords are not, because residential letting is exempt from VAT. A company that lets only residential property therefore has no VAT to account for and no Making Tax Digital for VAT duty. The position differs for commercial property, furnished holiday-style short lets run as a taxable trade, or a company that has opted to tax, where VAT registration and Making Tax Digital for VAT can apply. If none of those describe your company, Making Tax Digital for VAT is not your concern.

Should you incorporate to avoid Making Tax Digital?

Escaping quarterly Making Tax Digital reporting is a genuine effect of incorporating, but it is a weak reason to do it on its own. Moving property into a company does remove the personal Making Tax Digital for Income Tax obligation on that rent, replacing four quarterly updates and a final declaration with a single annual CT600. For a landlord dreading quarterly reporting, that is a real simplification. Holding property through a limited company changes far more than your tax reporting, though, and whether forming a limited company is right for you depends on your wider position: Corporation Tax and dividend tax versus personal Income Tax, buy-to-let mortgage rates that are typically higher for companies, the extra cost of company accounts, and the tax cost of incorporating an existing portfolio, where Capital Gains Tax and Stamp Duty Land Tax can apply on the transfer. Deciding to incorporate to sidestep a quarterly form, without weighing those, is the tail wagging the dog.

Frequently asked questions

Does Making Tax Digital apply to my limited company?

Not for Corporation Tax. HMRC confirmed in July 2025 that it will not introduce Making Tax Digital for Corporation Tax, so your company files its CT600 annually as before. Making Tax Digital for VAT applies only if the company is VAT-registered, which most residential landlords are not.

Has Making Tax Digital for Corporation Tax been scrapped?

Effectively, yes. HMRC's Transformation Roadmap of 21 July 2025 confirmed it will not proceed with Making Tax Digital for Corporation Tax and set no future date. Companies continue to file the CT600 through the standard annual process.

I hold property in a company and personally. What do I do?

Your company income goes on the annual CT600 and stays outside Making Tax Digital. Your personal rental and any self-employment income are measured against the qualifying income threshold on their own. If that personal total exceeds £50,000, you must use Making Tax Digital for Income Tax for the personal income from 6 April 2026, while the company keeps filing annually.

Do I need MTD software for my limited company?

Not for Making Tax Digital, because it does not apply to Corporation Tax. You do, however, now need commercial software to file the CT600 itself, since HMRC's free filing service closed on 31 March 2026. Keeping clean digital records year-round makes that filing straightforward, and you can start with August for free to keep your property income, expenses and compliance in one place.