Making Tax Digital for landlords: the plain-English guide

Last checked against GOV.UK: 16 October 2026

If your rental income (with any self-employment income) is over £50,000, Making Tax Digital for Income Tax has applied to you since April 2026. From April 2027 the line drops to £30,000. Here's what that means in practice.

Who's in, and when

Making Tax Digital (MTD) for Income Tax applies to sole traders and landlords who file Self Assessment returns. Whether you're in depends on your qualifying income on an earlier tax return:

Some people are exempt. If you think that might be you, check GOV.UK. Not sure where you stand? Try our Am I in MTD? checker.

What counts as qualifying income

Qualifying income is your total gross income from self-employment and property, before expenses. Wages, pensions, dividends and savings interest don't count towards it. For a jointly owned property, count your share of the rent, not the whole amount.

What you send, and when

Under MTD you keep digital records and send HMRC a summary four times a year, then a final declaration (your tax return) after the year ends.

Each update is cumulative: it covers 6 April up to the end of that quarter. If you spot a mistake, correct your records and the next update carries the right total. See every date on our deadlines page.

What goes in a landlord's update

Totals for each income and expense category, not individual receipts. For UK property the categories follow the Self Assessment property pages:

• Income: rent received, lease premiums, reverse premiums and other property income.
• Expenses: rent, rates, insurance and ground rents; repairs and maintenance; legal, management and other professional fees; costs of services, including wages; travel; other allowable expenses; non-residential finance costs.

If your property income is under £90,000 a year, you can usually send expenses as one consolidated figure instead of itemising them.

Jointly owned property

Each owner reports their own share. GOV.UK says joint owners can send income and expenses in their updates, or income only. If you send income only, add the expenses by resending your fourth update before you file your tax return.

Mortgage interest

Interest on a residential buy-to-let mortgage isn't deducted like other costs. Instead it earns a tax reduction at the basic rate (20% for 2026/27), worked out in your final declaration. Only the interest counts, never the capital part of repayments. From April 2027 that reduction is worked out at 22%, in line with the new property rates.

Can I still use a spreadsheet?

Yes, but not on its own. You can keep your records in a spreadsheet, then use bridging software that reads the figures and sends them to HMRC.

HMRC lists compatible products, including bridging software and some free options, on its software finder. Before you choose, check that a product:

• supports UK property for MTD for Income Tax (not just MTD for VAT)
• reads Excel or Google Sheets files
• handles the final declaration, not only quarterly updates
• suits your set-up, such as several properties or joint ownership

Our Landlord MTD Kit is a workbook built for exactly this: your share, in HMRC's categories, in one fixed block for bridging software to read.

Penalties

HMRC won't give penalty points for late quarterly updates in 2026/27. From April 2027, each late update earns a point, and four points bring a £200 penalty. Late tax returns and late payment are still penalised as before.

What changes in April 2027

• The MTD threshold falls to £30,000, bringing many more landlords in.
• Property income tax rates rise to 22% (basic), 42% (higher) and 47% (additional).
• Penalty points start for late quarterly updates.

Sources

• GOV.UK: Use Making Tax Digital for Income Tax, before you use this guide
• GOV.UK: Send quarterly updates
• GOV.UK: Find software that's compatible with MTD for Income Tax
• GOV.UK: MTD for Income Tax step by step

This guide is general information, not tax advice. Read how we write and check our guides.