Making Tax Digital for Income Tax - Now live

Making Tax Digital is live.
Is your rental income ready?

The first phase is now live for landlords with income over £50,000, with quarterly deadlines running through the year. A clear, jargon-free guide to what changes, whether it applies to you yet, and what to do next.

Check if it applies to me See the 2026 deadlines
4 quarterly updates a year
1 Final Declaration
No more annual Self Assessment
From April 2026
MTD for Income Tax is live for landlords earning over £50,000
Digital records
Quarterly updates
Final Declaration
HMRC-recognised software
Penalty points system
The basics

What Making Tax Digital means, in plain English

Instead of one annual Self Assessment return, you keep digital records and send HMRC a short update every quarter, then confirm your figures once a year.

What actually changes

You keep digital records of your property income and expenses, send HMRC four quarterly summaries during the year, then submit a single Final Declaration. The paper-style annual return is replaced by a digital rhythm.

Why HMRC is doing it

The aim is fewer manual errors and a more up-to-date picture of your tax position through the year. In practice it means more frequent admin, so the sooner your records are in order, the smoother it is.

Does it replace Self Assessment?

It replaces how you report your property income, not everything else. Your Final Declaration still brings together all your income for the year, so think of it as Self Assessment in a more regular, digital format.

Late submissions carry penalty points. HMRC runs a points-based system: one point for each missed quarterly deadline. Reach four points and a £200 penalty applies, with a further £200 for each late submission after that. Points clear after 24 months of submitting on time.
Who it applies to & when

The phased rollout, by income level

Your qualifying income is your gross income (rent plus any self-employment turnover, before expenses), assessed per person. If you own property jointly, only your share counts towards your threshold.

From April 2026
Over £50,000
Based on your 2024/25 tax return. First mandatory phase.
Mandatory now
From April 2027
Over £30,000
Based on your 2025/26 tax return.
Confirmed
From April 2028
Over £20,000
Based on your 2026/27 tax return.
Legislated

What is in scope

  • Residential rental properties in the UK.
  • Assured shorthold and standard residential tenancies.
  • Furnished holiday lets, now part of your ordinary UK property business.

What is out of scope

  • Overseas property, which is reported separately.
  • Commercial property outside the residential rules.
  • Other income, handled in your Final Declaration.
Not sure which threshold applies? Add your gross rent to any self-employment turnover, before deducting a penny of expenses. The total on your Self Assessment return is what triggers the rules. If you are close to a threshold or the position is complex, speak to a qualified tax adviser before deciding.
Your core obligations

Three things, on repeat

Strip away the jargon and MTD asks for three things. Get comfortable with these and the rest is process.

01

Keep digital records

Record your rental income and expenses digitally, in HMRC-recognised software, as you go. No more shoeboxes of receipts reconciled once a year.

02

Send quarterly updates

Four times a year, send HMRC a running summary of your income and expenses by category. Each update is cumulative, so it builds on the last.

03

Submit a Final Declaration

After the tax year ends, confirm your figures, claim any reliefs and allowances, and finalise your overall tax position in one submission.

Good news on year-end. HMRC has removed the separate End of Period Statement (EOPS) that appeared in earlier plans. The process is now simply four quarterly updates, then one Final Declaration. If you read a guide that still lists an EOPS step, it is out of date.
Your 2026 deadlines

The tax-year rail

Four submission windows follow the tax year, each with a deadline on the 7th, then a single year-end Final Declaration. Here is the full 2026/27 rhythm.

Tax year 6 April 2026 to 5 April 2027
2026 / 27
Quarter 1
6 Apr – 5 Jul 2026
Submit by
7 August 2026
Next up
Quarter 2
6 Jul – 5 Oct 2026
Submit by
7 November 2026
Next up
Quarter 3
6 Oct – 5 Jan 2027
Submit by
7 February 2027
Next up
Quarter 4
6 Jan – 5 Apr 2027
Submit by
7 May 2027
Next up
Year-end
Final Declaration for 2026/27
Due 31 January 2028

Can you pick your quarters?

Keep the standard tax-year quarters (from 6 April) or opt for calendar quarters (from 1 April) when you sign up. Choose early, as you cannot switch part-way through the year.

Can you submit early?

You can only submit once a quarter has closed, but you can prepare and review your figures ahead of time. Keeping records current makes each deadline a formality.

Getting ready

Four steps to be prepared

You do not need to wait until the deadline to act. Signing up early, even before you are mandated, lets you settle into the routine while the stakes are low.

Confirm whether MTD applies to you

Check your gross income against the thresholds above. Over £50,000 means you are in from April 2026. Even if you are not yet mandated, you can join voluntarily to get ahead.

Gather what you will need

  • Your Government Gateway user ID and password.
  • Your National Insurance number.
  • Your business start date (when you first received rental income).

Sign up with HMRC for MTD for Income Tax

A one-time step. Register directly with HMRC through GOV.UK using your Government Gateway credentials and follow the on-screen steps. HMRC may take a little time to confirm your enrolment, so start early.

Choose HMRC-recognised software and start recording

MTD requires you to keep records and submit through software recognised by HMRC. Pick a package that suits your portfolio, connect it to your HMRC account, and begin recording straight away so your first quarter is effortless.

Choosing software. The Landlord Association does not tie you to any single provider. Whichever tool you choose, make sure it is listed as recognised by HMRC for MTD for Income Tax. Members can talk through the options with our advice team before committing.
Properties & ownership

Report your share, not the whole property

HMRC wants your share of each property's income and expenses. If you own jointly, the figures are split by ownership share before they reach your submission, so you never overstate your income.

If you own solely

Your share is 100% and your figures are straightforward. You still record the ownership in your software so submissions calculate correctly.

If you own jointly

Record the full transaction and let your software apply your ownership percentage. Only your share flows into your quarterly updates. Each co-owner manages their own MTD obligations separately.

Worked example · a 60/40 split

You and your partner own a buy-to-let 60/40. In Quarter 1 you receive £3,000 in rent and pay a £500 repair bill. You record the full amounts. Your software applies your 60% share, so your submission shows:

Your income (60% of £3,000)
£1,800 reported
Your expense (60% of £500)
£300 reported
Setting your split. For jointly owned property, HMRC's default assumption is a 50/50 split between spouses or civil partners. A different split can be declared using a Form 17 where the beneficial ownership genuinely differs. Check your title deeds or declaration of trust, and take advice if you are unsure.
Recording transactions

Categorise it correctly the first time

HMRC needs your income and expenses broken into categories, not a single total. The right category protects the relief you are entitled to and keeps your tax calculation accurate.

Allowable expenses

Premises costsRent, rates, insurance and ground rents on the property.
Repairs and maintenanceKeeping the property in its existing condition. Improvements are capital, not repairs.
Finance costsMortgage interest and finance charges. Relief is restricted for individuals: reported separately with a 20% tax credit.
Professional and service feesLetting agent, accountancy and tenancy legal fees, plus services such as cleaning or gardening.
Travel and otherTravel wholly for the rental business, and other genuinely allowable property costs.

Not allowable

HMRC applies a strict "wholly and exclusively" test. If a cost is not incurred purely for the business, it cannot be claimed in full. These should not be recorded as expenses:

  • Capital improvements, which are separate from repairs.
  • Personal expenses of any kind.
  • Any cost not incurred wholly and exclusively for the property business.
Mixed-use and multi-property costs. Where a cost is part business, part personal, or spans several properties, claim only the business proportion and keep a record of how you worked out the split. Apply the same reasonable method year on year.

Recording income

Record rent in the period it is received, not when it is due. If a tenant pays two months at once, record the full amount on the date received. Non-refundable deposits you retain become rental income when they become non-refundable. Refundable deposits held in a scheme are not income.

Keep the paper trail

Attach a photo or scan of receipts to your expense records. It helps if HMRC ever queries a transaction. Spot a miscategorisation? Because quarterly updates are cumulative, the fix simply carries through your next update.

End-of-year reporting

One Final Declaration finishes the year

After your fourth quarterly update, the Final Declaration is the only year-end submission you need. It brings your property figures together with all your other income, applies your reliefs and allowances, and finalises your tax.

What it covers

  • Confirmation that your four quarterly updates are complete.
  • Year-end adjustments, corrections and any expenses you missed.
  • Reliefs and allowances claimed once a year, such as the property income allowance.
  • Your total income from all sources, so your overall tax is calculated.

When it is due

The Final Declaration is due by 31 January following the end of the tax year, the same familiar date as today's Self Assessment deadline. For 2026/27, that means 31 January 2028.

You can finalise as soon as the tax year ends and all four updates are in. Filing early gives you more time to plan for any tax due.

No transactions in a quarter? You still submit. Once enrolled, MTD requires an update every quarter regardless of activity, so a void period between tenancies means a nil update, not a missed one. A nil submission counts as valid and keeps you clear of penalty points.
Common questions

Answered plainly

What if I miss a deadline?

You collect one penalty point per missed quarterly deadline. Reach four points and a £200 penalty applies, then a further £200 for each late submission after that. Points expire after 24 months, provided your submissions are up to date in the meantime.

Separate late-payment penalties apply if you underpay your tax, and they grow the longer the amount is outstanding. If you are at risk of missing a deadline, still submit with the figures you have; because updates are cumulative, you can correct them next time.

What happened to the End of Period Statement?

HMRC removed the separate EOPS step from the MTD for IT design. The current process is four quarterly updates followed by a single Final Declaration. Older guides that describe an EOPS in between are out of date.

Do furnished holiday lets still count?

From April 2025 the separate furnished holiday let regime was abolished. FHLs are now treated as part of your ordinary UK property business and are included in your quarterly updates alongside your other residential lets. If you previously ran FHLs under the old rules, take advice on how the change affects you.

What if I sell a property mid-year?

Record all income and expenses up to completion, and update the ownership from the date of sale. Those figures still appear in your quarterly updates for that year. Any capital gain is reported separately through Capital Gains Tax, not through MTD for Income Tax.

Can I amend a submission after sending it?

Quarterly updates are cumulative, so a correction to an earlier quarter carries through your next update within the same tax year. Once the Final Declaration is submitted, the year is finalised, and corrections after that are made through HMRC's amendment process, usually with an adviser's help.

I file the residence pages. Am I deferred?

Individuals who complete the residence pages of their tax return have a one-year deferral and are not required to join until April 2027 at the earliest. If this applies to you, confirm your position with a qualified adviser, as the rules here are more involved.

We're here to help

MTD doesn't have to be complicated

The Landlord Association helps you get ready, stay compliant and file with confidence. Our guidance is independent, our advice team knows the rental sector, and everything is written for landlords, not accountants.

Explore membership Review the deadlines

TLA Knowledge Base

Step-by-step articles covering every stage of MTD, from getting set up to year-end reporting.

Member advice line

Talk through your position with our team before you commit to software or a filing approach.

Deadline reminders

Stay ahead of every quarterly window and your Final Declaration, so no submission slips through.

This guide is provided by The Landlord Association for general information about Making Tax Digital for Income Tax and does not constitute tax, financial or legal advice. Rules, thresholds and dates may change. Always confirm your position with HMRC or a qualified tax adviser before acting. Figures and deadlines are correct at the time of publication.