Making Tax Digital for Income Tax (MTD) changes how many UK landlords deal with HMRC. Instead of one tax return a year built from a shoebox of receipts, you keep digital records, send a short update every three months and then file your tax return through software. It started on 6 April 2026 for landlords and sole traders with qualifying income over £50,000, and the threshold is set to fall in 2027 and 2028.
This guide explains who is in, when, what you have to send and when. It is general information, not tax advice. Check the gov.uk guidance and speak to an accountant about your own position.
Who MTD for Income Tax applies to
MTD for Income Tax applies to individuals who are registered for Self Assessment and have income from self-employment, property, or both. Whether you are in depends on your qualifying income: your total gross income from self-employment and property, before expenses.
So a landlord with £35,000 of rent a year is judged on the £35,000, not on the profit after mortgage interest, repairs and agent fees. Employment income, dividends, pensions and your share of a partnership's income do not count. If you own a let jointly, only your share counts. Our guide to MTD qualifying income for landlords goes through the rules with examples.
When it starts: the thresholds
HMRC looks at the tax return for the tax year two years before each start date.
| Start date | Qualifying income over | Based on your return for | Status |
|---|---|---|---|
| 6 April 2026 | £50,000 | 2024-25 | In force |
| 6 April 2027 | £30,000 | 2025-26 | Legislated, not yet commenced |
| 6 April 2028 | £20,000 | 2026-27 | Legislated, not yet commenced |
The thresholds are set in the Income Tax (Digital Requirements) Regulations 2026. The first applies now. The later two are in the regulations, but the obligation does not start until each date arrives.
HMRC writes to people it thinks are over the threshold, but the responsibility to check is yours.
What you have to do under MTD
According to the gov.uk guidance, you still submit one tax return a year and pay your tax as you do now, both by 31 January after the tax year ends. What is new is:
- Keep digital records of your property (and any self-employment) income and expenses, with the amount, the date and the category.
- Send a quarterly update every three months. These are totals, not tax returns.
- Submit your tax return through software by 31 January after the end of the tax year. HMRC calls this the final declaration. The end of period statement that was once planned has been removed.
Software: what you need
HMRC does not provide software. You need software that is compatible with MTD for Income Tax. HMRC has a guide to choosing the right software, and the gov.uk page says all software listed on its software finder tool has been through HMRC's recognition process.
You do not have to give up spreadsheets. The gov.uk guidance says: "if you use spreadsheets for your records, you can continue to use them. But you'll still need software that links to your spreadsheets (sometimes called bridging software). This is how you'll send quarterly updates and submit your tax return." (Using MTD for Income Tax for the first time)
In short: a spreadsheet can hold your records, but sending anything to HMRC needs compatible software. When you are ready, gov.uk explains how to sign up for MTD for Income Tax.
Quarterly update dates
Updates are cumulative: each one covers everything from the start of the tax year to the end of that quarter. You must send an update even if there is nothing to report.
| Quarter (standard) | Quarter (calendar option) | Update due |
|---|---|---|
| 6 April to 5 July | 1 April to 30 June | 7 August |
| 6 April to 5 October | 1 April to 30 September | 7 November |
| 6 April to 5 January | 1 April to 31 December | 7 February |
| 6 April to 5 April | 1 April to 31 March | 7 May |
Calendar quarters are an option, not the default. You choose them before your first update of the tax year, and the choice carries on into later years until you withdraw it (SI 2026/336). If you use calendar quarters, anything dated 1 to 5 April goes into the period that starts on 1 April. Source: send quarterly updates.
For a jointly let property, the guidance allows you to send income only in your quarterly updates, and add the expenses before you submit your tax return.
Your first MTD year: key dates
If you joined on 6 April 2026, your 2026-27 tax year looks like this:
- 7 August 2026, 7 November 2026, 7 February 2027 and 7 May 2027: quarterly updates due.
- 31 January 2027 and 31 July 2027: payments on account for 2026-27, each half of your 2025-26 bill (gov.uk).
- 31 January 2028: your first MTD tax return and the balancing payment for 2026-27.
MTD does not change the payment dates. Payments on account are not needed if last year's tax was under £1,000, or if more than 80% of it was taken at source.
Penalties
MTD brings in a points-based system for late filing (gov.uk penalties guidance):
- One point for each missed deadline. At 4 points you pay a £200 penalty, and £200 for each further missed deadline.
- For the 2026-27 tax year, HMRC will not give points for late quarterly updates. Points still apply to a late tax return.
- Late payment in 2026-27: 3% of the tax unpaid at day 15, a further 3% at day 30, then 10% a year from day 31. In your first year there is no penalty if you pay or agree a payment plan within 30 days.
Announced, not yet in force: higher late payment penalties of 4% and 4% from the 2027-28 tax year, and a 2-point threshold for annual filers from April 2027.
Late payment interest is 7.75% at the time of checking. HMRC has announced it will rise to 8.00% from 24 November 2026.
Exemptions
You are automatically exempt if, for example, your qualifying income is £20,000 or less, you do not have a National Insurance number, or you are a trustee. Some people are exempt until at least April 2027, including those claiming averaging relief. You can also apply if you are digitally excluded, for example because of age, health, disability or no internet access. See find out if you can get an exemption.
What about limited companies?
MTD for Income Tax is for individuals in Self Assessment, such as sole traders and landlords who let in their own name. Partnerships are not yet in scope. If you let through a limited company, check the gov.uk guidance and your accountant for the rules that apply to the company.
FAQ
Do landlords need to use Making Tax Digital?
Yes, if your qualifying income from property and self-employment, before expenses, is over the threshold. It is over £50,000 from 6 April 2026, over £30,000 from 6 April 2027 and over £20,000 from 6 April 2028.
When does Making Tax Digital start for landlords?
It started on 6 April 2026 for qualifying income over £50,000. The £30,000 and £20,000 thresholds are legislated to start on 6 April 2027 and 6 April 2028.
Is Making Tax Digital based on rent or profit?
Rent. Qualifying income is your gross property income before expenses, plus any self-employment income before expenses.
Can I use a spreadsheet for Making Tax Digital?
You can keep your records in a spreadsheet, but gov.uk says you will still need software that links to it, sometimes called bridging software, to send quarterly updates and submit your tax return.
When are MTD quarterly updates due?
On 7 August, 7 November, 7 February and 7 May. The dates are the same whether you use standard or calendar quarters.
Keep your records in order
The Ashlar Ledger MTD landlord record keeper is coming soon. It is a record-keeping workbook for your property income and expenses, with quarterly totals and a Self Assessment planner. It does not send anything to HMRC, so you will still need compatible software to file. View the MTD Landlord Record Keeper
Still choosing a property? Our guide on how to calculate buy-to-let rental yield shows the numbers to check first.
This is not tax advice. Figures checked against official sources on 10 November 2026. Ashlar Ledger: figures you can build on.