Making Tax Digital (MTD) is one of the biggest changes to the UK tax system in decades. Millions of landlords who currently submit a Self Assessment tax return once a year will soon need to keep digital records and report their income more regularly, four times a year instead of once. HMRC is introducing the system to modernise tax reporting and reduce the estimated £5 billion lost each year to avoidable errors.
If you receive rental income from UK property, this guide explains what is changing, when it starts, and what you will need to do differently. MTD for property income applies whether you let a single flat or a portfolio of properties across the country.
Making Tax Digital for Income Tax Self Assessment (MTD for ITSA) is a government programme that replaces the traditional annual Self Assessment tax return with a digital reporting system. Landlords and self-employed people will keep digital records and send summary updates to HMRC throughout the year using approved software.
The system is not about paying tax more often. Your overall tax liability does not change. What changes is how frequently you report income and expenses to HMRC, and the requirement to use software to do it.
MTD applies to landlords with combined property and self-employment income above the relevant threshold. The government is phasing it in over three years:
| Start Date | Applies If Gross Income Exceeds |
|---|---|
| April 2026 | £50,000 |
| April 2027 | £30,000 |
| April 2028 | £20,000 |
The threshold is based on gross income before deducting expenses. It includes rental income from UK and overseas property and income from self-employment. It does not include employment income, pensions, savings interest, or dividends.
A landlord with £45,000 in rental income and no self-employment income would not be caught until April 2027, when the threshold drops to £30,000. A landlord with £55,000 in combined rental and self-employed income would need to join from April 2026.
Once you are within scope of Making Tax Digital, you will have three main obligations throughout the tax year:
HMRC requires you to record your property income and expenses digitally. This means using software rather than paper records or a basic spreadsheet that is not connected to HMRC systems. Your records must be kept in a digital format that your MTD software can read and submit.
You do not need to scan every receipt. You simply need to record each transaction digitally, the amount, category, and date, as it occurs. Keeping records throughout the year rather than at year end makes the quarterly submission process straightforward.
Four times a year you submit a summary of your property income and expenses to HMRC. HMRC offers two schedules — Standard update periods and Calendar update periods — and you choose the one that suits your bookkeeping in Settings → Property Filing Obligations. Submission deadlines are the same on both schedules (the 7th of the month after each quarter ends). Once HMRC has received your first quarterly update for the tax year, the choice is locked until the next tax year.
| Quarter | Period |
|---|---|
| Q1 | 6 April – 5 July |
| Q2 | 6 July – 5 October |
| Q3 | 6 October – 5 January |
| Q4 | 6 January – 5 April |
| Quarter | Period |
|---|---|
| Q1 | 6 April – 30 June |
| Q2 | 1 July – 30 September |
| Q3 | 1 October – 31 December |
| Q4 | 1 January – 31 March |
Each update contains summary totals of your income and expenses for that quarter. It is not a full tax return and does not trigger a tax payment. HMRC uses the updates to build a running picture of your income across the year.
The Final Declaration is submitted after the end of each tax year, by 31 January, the same deadline as the current Self Assessment tax return. It effectively becomes the digital tax return for landlords under MTD, replacing the Self Assessment return for income covered by MTD.
In the Final Declaration you confirm your total income and expenses, include any adjustments, and claim any additional tax reliefs. Once you submit it, HMRC calculates your final tax liability and tells you how much is due. Payment is still due by 31 January.
If you have income that falls outside MTD, for example employment income, savings interest, or capital gains, you may still need to include that in the Final Declaration or through a separate process.
HMRC requires landlords to submit MTD updates through compatible software. Unlike the current Self Assessment system, you cannot submit updates by logging into the HMRC website and entering figures manually. The submissions must come from software that connects directly to HMRC's systems using an approved API connection.
Software approved for MTD must be able to keep digital records, generate the required summaries, and send them securely to HMRC. Not all accounting software supports MTD for Income Tax, it is worth checking before April 2026 that any software you currently use is compatible.
SimplifyMTD is designed specifically for landlords. Rather than a general-purpose accounting package, it focuses entirely on property income reporting and guides you through each quarterly submission and your Final Declaration step by step.
If your rental income is above the threshold, MTD applies regardless of how many properties you own. A single property generating £55,000 in rent falls within scope from April 2026. You will need to record income and expenses for that property digitally and submit quarterly. MTD for small landlords works in exactly the same way as for larger portfolios — the obligations are identical, just the scale differs.
Landlords with multiple properties will report combined totals. If your properties are held in the same name, you submit one set of quarterly updates covering all properties. If properties are held in different legal structures, for example some in your personal name and some in a limited company, each entity has its own reporting obligations.
If you have both rental income and self-employment income, both sources count toward the threshold. You will submit separate quarterly updates for each income type, one for property and one for self-employment, but through the same software.
MTD changes how you report, not how much tax you pay. The rules about allowable expenses, tax reliefs, and taxable income remain the same. The annual tax payment deadline of 31 January remains the same. What changes is the frequency and method of reporting.
Making Tax Digital will affect millions of landlords over the coming years. The sooner you understand what is required and start keeping digital records, the smoother the transition will be. Landlords who wait until the last moment risk rushing to find compatible software and scrambling to reconstruct records.
SimplifyMTD is built specifically for landlords making this transition. It handles the quarterly submissions, guides you through the Final Declaration, and keeps your records in the format HMRC requires. Visit the SimplifyMTD homepage to find out more, or see our landlord MTD FAQs for answers to common questions.