Making Tax Digital for Landlords: What UK Property Owners Need to Know in 2026

Making Tax Digital (MTD) for Income Tax is one of the biggest changes to UK tax reporting for landlords and self-employed individuals in recent years. If you own rental property, it is important to understand whether the new rules apply to you and what action you need to take.

For many London-based landlords, the first reporting deadline is 7 August 2026.

What Is Making Tax Digital for Landlords?

Making Tax Digital (MTD) is HMRC’s move towards a fully digital tax system. Instead of filing one annual Self-Assessment tax return, landlords will need to:

• Keep digital records of rental income and expenses
• Submit quarterly updates to HMRC using compatible software
• Complete an end-of-year final declaration

Why This Matters

For busy landlords, especially those with multiple properties, MTD means more administrative work and more frequent reporting. Having an accountant does not necessarily mean you are aware of your basic obligations. Preparing early will reduce stress and help avoid penalties.

When Does Making Tax Digital Start?

MTD for Income Tax will be introduced in stages.

https://makingtaxdigital.campaign.gov.uk/

What Counts as Qualifying Income?

For landlords, qualifying income includes:

• UK residential rental income
• Overseas rental income
• Commercial property income
• Holiday let income
• Your share of jointly owned rental property income
• Self-employment income if you are a sole trader or freelancer.

Qualifying income does not include:

• PAYE salary income
• Pension income
• Savings interest
• Dividends
• Partnership income
• Limited company income

Useful link: https://www.gov.uk/guidance/work-out-your-qualifying-income-for-making-tax-digital-for-income-tax

Are There Any Exemptions?

There are many who may qualify. Possible reasons include:

• Age-related difficulty using digital systems
• Disability or health conditions
• Lack of internet access
• Religious objections to digital technology
• Other practical barriers to complying

Some overseas landlords may also be exempt (MTD requires an NI number), but non-resident status alone does not automatically mean an exemption (ie, the NRL Scheme is different and separate).

Useful link: https://www.gov.uk/guidance/find-out-if-you-can-get-an-exemption-from-making-tax-digital-for-income-tax

Digital Records – ‘Simpler Categorisation’

Also called the ‘three line accounts’, if the gross income from either the property or self-employment is less than £90k, you only need to record the date, amount, and whether it’s an expense or income.

If you also receive income as a landlord, and the turnover is less than £90k, you must keep a record of expenses.

If the turnover is £90k or more, you need to fully categorise your income and expenses.

Useful link: https://www.gov.uk/guidance/use-making-tax-digital-for-income-tax/create-digital-records

Joint Let Property – Easements

Joint property owners will need to report their share of rental income separately. However, HMRC has introduced certain easements to reduce the administrative burden, if both are using digital reporting.

An eligible person may create one digital record per income category for all income received and report rental expenses at the end of the tax year, rather than including them in each quarterly update.

Useful link: https://www.gov.uk/guidance/use-making-tax-digital-for-income-tax/create-digital-records

Quarterly Reporting Deadlines for Landlords

Through the HMRC’s MTD-approved software (allegedly more than 90), you must send your updates according to these deadlines:

Useful link: https://makingtaxdigital.campaign.gov.uk/mtd-for-income-tax-dates/

How Can Landlords Prepare for Making Tax Digital?

If you own rental property, now is the time to prepare by:

1. Reviewing your rental income levels
2. Checking whether you meet the threshold
3. Organising income and expense records
4. Choosing MTD-compatible software
5. Speaking with your accountant or tax adviser

Need advice on rental property or landlord compliance? Contact us today on 0203 588 5115.

Disclaimer: Tax rules can change and depend on personal circumstances. Always seek professional tax advice. Marybow Property takes all reasonable care to ensure that the information contained on this website is accurate. However, we cannot guarantee the accuracy or completeness of the content. Our website, including the blogs, is not legal or financial advice and should not be construed as such. We reserve the right to change the information on this website at any time.