Making Tax Digital for Landlords: What You Need to Know Ahead of April 2026
Making Tax Digital for Landlords: What You Need to Know Ahead of April 2026
From 1st April 2026, HMRC’s Making Tax Digital (MTD) initiative will bring major changes to how landlords report their income and manage their tax affairs. If you're a landlord earning more than £50,000 a year in rental income, it's crucial to understand what this means for you—and how to prepare.
At Bates & Co Lettings, we’re committed to keeping our landlords informed and compliant with all regulatory changes, including this important shift in the tax system.
What is Making Tax Digital?
Making Tax Digital is HMRC’s long-term strategy to digitise the UK tax system, aiming to make tax administration more effective, efficient, and easier for taxpayers. The scheme has already been rolled out for VAT-registered businesses, and now it’s the turn of individual landlords.
From April 2026, landlords with annual rental income above £50,000 will be required to:
- Keep digital records of income and expenses.
- Use MTD-compatible software to submit quarterly updates to HMRC.
- File an annual final declaration through the new system, replacing the traditional Self Assessment tax return.
From April 2027, the scheme will expand to include landlords earning between £30,000 and £50,000.
Who Is Affected?
- Private landlords with property income above £50,000 (April 2026) or above £30,000 (April 2027).
- Individuals, not companies or partnerships, although further MTD changes may apply to those in future.
- Landlords managing both residential and commercial property portfolios.
If your total property income across all properties exceeds the threshold, you’ll need to comply—even if each property alone earns less.
What Will You Need to Do?
To stay compliant, landlords will need to:
- Choose MTD-compatible software: You must use HMRC-approved digital software to keep records and submit updates. Examples include Xero, QuickBooks, or specialist property accounting platforms.
- Maintain accurate digital records: Every transaction must be logged digitally and categorised correctly.
- Submit quarterly updates: You'll report income and expenses every three months instead of once a year.
- Submit an End of Period Statement (EOPS): This replaces the Self Assessment tax return, summarising your final figures.
Why This Matters for Landlords
Failure to comply with MTD can result in penalties and interest charges. More importantly, keeping digital records and submitting regular updates will require a more hands-on approach to your property finances.
At Bates & Co Lettings, we’re helping landlords prepare early. Our property management clients benefit from:
- Detailed monthly income and expense statements
- Advice on choosing MTD-compatible software
- Referrals to trusted tax advisors
- Full financial transparency for your portfolio
How Bates & Co Can Help
As a specialist letting agency, we don’t just manage tenancies—we provide the tools and support landlords need to remain compliant, profitable, and stress-free. Whether you're managing a single buy-to-let or a large portfolio, we’ll help you transition smoothly to the new MTD requirements.
We offer:
Transparent monthly accounting
End-of-year statements ready for your accountant
Advice and support tailored to your rental income situation
Start Preparing for MTD Now
Don’t wait until 2026. Get your systems in place early and avoid last-minute stress. Speak to Bates & Co Lettings today about how we can help you stay one step ahead of the upcoming Making Tax Digital requirements.
