MTD Landlords Guide: What Property Owners Need to Know for 2026

From April 2026, MTD landlords across the UK will face new requirements for reporting their property income to HMRC. If you’re a landlord earning over £50,000 annually, you'll be required to join the Making Tax Digital for Income Tax Self Assessment (MTD for ITSA) scheme — marking a major shift from the traditional Self Assessment process.

If you earn between £30,000 and £50,000, you’ll be brought into scope one year later, in April 2027. For landlords, this means a significant change in how records are kept and how income is reported.

This guide explains everything MTD landlords need to know — from who it affects and what it requires, to how to stay compliant and which tools to use.

What Is MTD and How Does It Affect Landlords?

Making Tax Digital (MTD) is a government initiative designed to modernise the UK tax system. The goal is to reduce tax errors, improve accuracy, and make it easier for taxpayers to manage their affairs.

For landlords, MTD means replacing the single annual tax return with a system of quarterly income and expense updates, plus an annual End of Period Statement and Final Declaration.

These changes aim to increase transparency and reduce the number of late or inaccurate tax filings by requiring real-time digital reporting.

Who Is Affected by MTD for Landlords?

MTD landlords include individuals who receive income from:

Residential property lettings

Furnished holiday lets in the UK or EEA

Commercial property

Mixed-use property portfolios

You will fall under MTD for Income Tax if your total self-employment and/or property income is above the following thresholds:

Over £50,000: MTD applies from April 2026

Over £30,000: MTD applies from April 2027

If your income is below £30,000, you are not currently required to join the scheme, although this threshold may be revised in future.

Limited companies and partnerships are not yet affected by MTD for Income Tax, but changes are expected later in the decade.

Key Requirements for MTD Landlords

Under MTD, landlords must comply with the following obligations:

Maintain Digital Records

You’ll need to record income and expenses digitally, using software that integrates with HMRC. Paper records or manual spreadsheets will no longer meet the legal requirements.

MTD landlords should ensure their record-keeping is:

Complete and accurate

Maintained in near real-time

Categorised according to HMRC’s tax rules

Submit Quarterly Updates

Instead of one annual Self Assessment return, landlords must submit quarterly updates to HMRC. These reports summarise rental income and expenses for each quarter.

Quarterly updates are due one month after the end of each quarter and allow HMRC to estimate your annual tax position throughout the year.

End of Period Statement (EOPS)

At the end of the tax year, landlords will need to review and finalise their income, confirm allowable expenses, and submit an End of Period Statement.

The EOPS adjusts the quarterly figures and applies final tax calculations, replacing parts of the current annual return process.

Final Declaration

Once all income sources (including non-property income) are confirmed, landlords must submit a Final Declaration. This replaces the traditional Self Assessment tax return and confirms your total tax liability.

Example MTD Timeline for a Landlord

Suppose you earn £55,000 annually from letting two properties. Here's what your reporting schedule under MTD might look like starting in April 2026:

1st Quarterly Update (April–June): due 5 August 2026

2nd Quarterly Update (July–September): due 5 November 2026

3rd Quarterly Update (October–December): due 5 February 2027

4th Quarterly Update (January–March): due 5 May 2027

End of Period Statement: submitted by 31 January 2028

Final Declaration: submitted by 31 January 2028

What Software Do MTD Landlords Need?

To comply with MTD, landlords must use MTD-compatible software that is recognised by HMRC. This software allows you to:

Store and categorise property income and expenses

Submit quarterly updates, EOPS, and Final Declarations

Integrate with HMRC's MTD API

Maintain a full digital audit trail

Popular software options for MTD landlords include:

QuickBooks

Xero

Sage Accounting

Hammock (landlord-specific)

FigsFlow (for landlords and accountants)

FreeAgent

Using bridging software with spreadsheets may be allowed in some limited cases, but this is not recommended as a long-term solution.

Benefits of Making Tax Digital for Landlords

While the transition to MTD may seem complex, it comes with several long-term benefits for landlords.

Improved Accuracy

Digital records and automated calculations reduce the likelihood of human error and missed deductions.

Better Financial Oversight

Quarterly updates give landlords a more consistent view of their finances, making it easier to budget and forecast tax bills.

Streamlined Tax Filing

The structured process of MTD can make it easier to stay organised, particularly for landlords with multiple properties or mixed income sources.

Fewer Late Penalties

With automatic reminders and more frequent submissions, MTD helps landlords avoid missed deadlines and late-filing penalties.

Challenges for MTD Landlords

Despite its benefits, MTD introduces new challenges — especially for landlords who are used to once-a-year reporting.

Some common issues include:

Software costs: Landlords may need to invest in paid software subscriptions, although some providers offer affordable plans.

Learning curve: Getting used to new systems and record-keeping formats can take time, especially for landlords with minimal digital experience.

Managing multiple properties: Tracking income and expenses across several properties may require more structured systems and training.

Working with a digital-savvy accountant or property tax adviser can make the transition smoother, especially for landlords with larger or complex portfolios.

How MTD Affects Landlord-Accountant Relationships

For landlords who work with accountants, MTD represents a shift in the timing and frequency of communication. Rather than preparing one annual tax return, accountants will now need to review and submit data four times per year, plus two year-end filings.

This may affect fee structures, workflows, and client responsibilities. MTD landlords should talk with their accountants now to clarify how services will be managed and priced under the new regime.

Platforms like FigsFlow, which integrate onboarding, AML, and making tax digital guide in one place, are increasingly used by accountants serving property clients.

How to Prepare for MTD as a Landlord

Landlords should begin preparing well ahead of the MTD deadlines. Here’s how:

Check your income: Determine if you’ll be affected in April 2026 or 2027.

Review your current record-keeping: Identify whether your system is digital and MTD-ready.

Choose MTD-compatible software: Select a provider that meets your needs, especially if you manage more than one property.

Speak with an accountant: Discuss how quarterly updates will be managed, and if you’ll need ongoing support.

Start early: Practice digital record-keeping in advance of your MTD start date to ease the transition.

Final Thoughts on MTD for Landlords

MTD landlords will need to adapt to a new era of digital tax reporting. With quarterly updates, stricter record-keeping rules, and increased software requirements, being prepared is the best way to stay compliant and reduce stress.

While the change may seem daunting at first, it offers landlords a more organised, transparent way to manage their finances — and reduces surprises at the end of the tax year.

Whether you manage one flat or a portfolio of properties, preparing for MTD now will put you in the best position to meet the new requirements with confidence.