Making Tax Digital for Landlords, Explained

Making Tax Digital for Income Tax Self Assessment replaces the once-a-year return with digital record-keeping and four quarterly updates through compatible software. For landlords over the threshold, it is a change of habit, not just of form.

What it actually requires

Three things: keep digital records of all income and expenses, submit a quarterly summary to HMRC through MTD-compatible software, and file a final end-of-period statement each tax year in place of the old return.

When it applies to you

It phases in by total gross income from property and any trade, before expenses:

The £20,000 tier for April 2028 has now been confirmed. Our free MTD eligibility checker tells you which phase you fall into.

What counts as property income

Gross rent from residential lettings, furnished holiday letting income (which may carry separate rules), and ground rent or service charge income. It excludes capital gains from sales, savings interest, and employment income.

The quarterly rhythm

The four periods run 6 April–5 July, 6 July–5 October, 6 October–5 January, and 6 January–5 April, each due by the 5th of the following month. These are summaries, not returns, and you correct them in the final declaration, which replaces Self Assessment and is where you claim any remaining reliefs.

Missing a deadline

HMRC issues penalty points for late submissions; accumulate enough and a financial penalty follows, under the structure in the Finance Act 2021. The practical defence is keeping records current through the year rather than reconstructing them each quarter.