Making Tax Digital for Landlords: What You Need to Know

Does MTD for Income Tax apply to landlords?

Yes. Making Tax Digital for Income Tax Self Assessment (MTD ITSA) applies to individual landlords with UK property income, in exactly the same way it applies to sole traders — it is not just a self-employment rule. If your rental income is above the relevant threshold for your start date, you must keep digital records and submit quarterly updates to HMRC instead of a single annual Self Assessment return.

For the full mechanics of MTD ITSA — quarterly update periods, the final declaration, and software requirements — see our complete guide to Making Tax Digital. This article focuses on what is different, or easy to get wrong, for landlords specifically.

The income thresholds and when they apply to you

MTD ITSA is being phased in by income level:

For landlords, HMRC looks at your gross rental income (plus any self-employment income, if you have both) as reported on your most recent Self Assessment return. If your combined self-employment and property turnover was above £50,000 on your 2024/25 return, you are in scope from April 2026.

What counts as "qualifying income" for a landlord

Qualifying income is your gross rental income before expenses — not your rental profit. A landlord with £60,000 in rent and £35,000 of mortgage interest, repairs and agent fees has qualifying income of £60,000, not the £25,000 left after costs, and is in scope at the £50,000 threshold.

If you have income from more than one UK property, all your UK property income is added together as a single property business for this purpose — you do not assess each property separately. Self-employment income and property income are then combined to test against the threshold.

Jointly owned property

Where a property is owned jointly — for example, by a married couple — each owner's share of the rental income is assessed against the threshold separately, based on their own share of the income, not the total rent the property generates. A property that produces £70,000 a year in rent, split 50/50 between two joint owners, gives each owner £35,000 of qualifying income — which may put one or both of them in scope at a different point depending on what other income they have and which threshold year applies.

This means two joint owners of the same property can end up in scope for MTD ITSA at different times, or not at all, depending on their individual circumstances.

What changes once you are in scope

Once your property income is in scope, you need to:

• Keep digital records of your rental income and allowable expenses, rather than reconstructing them from paper later
• Submit a quarterly update to HMRC summarising income and expenses for each quarter
• Submit a final declaration after the tax year ends, replacing your annual Self Assessment return

For the 2026/27 tax year, quarterly updates are due on 7 August, 7 November, 7 February and 7 May, with the final declaration due by the following 31 January. HMRC has confirmed no penalty points apply to late quarterly updates during 2026/27, but late tax payment and late final declarations are penalised as normal — see our MTD for Income Tax deadlines and penalties guide for the detail.

For the specific allowable expenses and reliefs available to landlords — including the mortgage interest restriction and the Rent a Room scheme — see our guide to rental income tax for UK landlords.

Furnished holiday lets and MTD

The Furnished Holiday Lettings (FHL) regime was abolished from 6 April 2025. Former FHL properties are now taxed as ordinary UK property income, which also means they are now assessed against the same MTD ITSA thresholds as any other rental property, combined with your other property income rather than tracked as a separate category.

Getting ready

If you are a landlord approaching the £50,000 or £30,000 threshold, the practical steps are the same as for any sole trader: confirm whether you are in scope based on your most recent Self Assessment figures, sign up for MTD ITSA with HMRC, move your rental bookkeeping into MTD-compatible software, and start keeping digital records from the start of your current tax year rather than waiting until a deadline is close. The practice is MTD-ready via Xero for bookkeeping purposes — if you would like help getting your rental records into shape before your next deadline, get in touch.