Making Tax Digital for Landlords: What You Need to Know Before April 2026

A significant change to the way landlords report their income to HMRC is coming into effect from 6 April 2026. Making Tax Digital for Income Tax Self Assessment (MTD for ITSA) will require many landlords to move away from the traditional annual tax return and instead submit income and expense data to HMRC on a quarterly basis, using HMRC-approved software.

If you own rental property and your total income from property and self-employment combined exceeds £50,000 per year, this change affects you from April 2026. Landlords with combined income between £30,000 and £50,000 will follow from April 2027.

Making Tax Digital is a government initiative designed to modernise the UK tax system. The aim is to reduce errors, improve accuracy, and give both taxpayers and HMRC a clearer, more up-to-date picture of income and tax liabilities throughout the year rather than in a single annual submission.

MTD for VAT has already been in place for VAT-registered businesses since 2019. MTD for Income Tax is the next phase, and for landlords, it represents a meaningful change in administrative routine.

Under MTD for ITSA, landlords will be required to:

•         Keep digital records of rental income and allowable expenses throughout the year.

•         Submit quarterly updates to HMRC using HMRC-approved software — these are summaries of income and expenditure, not full tax returns.

•         Submit a final end-of-period statement and tax return at the end of the tax year to confirm the figures and claim any reliefs or adjustments.

The four quarterly deadlines will fall in August, November, February, and May each year. Missing these deadlines may result in penalty points under HMRC’s new points-based system.

MTD for ITSA applies to individuals who are registered for Self Assessment and whose gross income from property and/or self-employment exceeds the relevant threshold. The rollout is staged:

•         From 6 April 2026 — landlords with combined gross income over £50,000.

•         From 6 April 2027 — landlords with combined gross income over £30,000.

•         From a later date (yet to be confirmed) — landlords with income between £20,000 and £30,000.

Note that this is gross income, not profit. It is the total rental income received before any expenses are deducted. If you hold multiple properties, the income from all of them is combined for the purposes of this threshold.

Limited companies that own rental properties are not affected by MTD for ITSA, as this applies to individuals only.

You will need to use HMRC-compatible software to maintain your digital records and submit your quarterly updates. A range of options are available, from dedicated landlord accounting platforms to broader accounting software packages. HMRC maintains a list of approved software on its website.

If you use a bookkeeper or accountant, they will likely already be exploring compatible software options. We strongly recommend speaking with your accountant or tax adviser as early as possible to agree on a solution that suits your circumstances.

With April 2026 approaching, there are several practical steps landlords should take in the coming months:

•         Confirm whether you meet the £50,000 threshold. Add up your total gross rental income across all properties, plus any self-employment income.

•         Speak to your accountant or tax adviser. They can confirm your obligations, recommend suitable software, and help you set up a compliant record-keeping system.

•         Choose and set up your MTD-compatible software before the deadline. Do not leave this until March 2026.

•         Review how you currently record income and expenses. Moving to digital record-keeping will require a change in habits if you currently use spreadsheets or paper records.

•         Ensure your rental income records are accurate and up to date. Your quarterly submissions will draw on these, so clarity from the outset is essential.

As your letting agent, Stewarts Estates can support your preparation in a number of ways. For landlords on our fully managed service, we provide clear monthly financial reporting that details rent received and any deductions — this documentation can be used directly to support your quarterly MTD submissions.

We can also ensure that your rent statements and annual income summaries are provided in a format that is straightforward to pass on to your accountant or to input into your chosen MTD software.

If you have any questions about how your rental income is recorded and reported, please do not hesitate to get in touch with our team.

Have questions about your rental income records or how MTD may affect your portfolio? Call us on 01202 805050 or visit stewartsestates.co.uk — our team is happy to help.