Tax
Making Tax Digital for landlords: who is in, when, and what you have to do
MTD for Income Tax started for landlords with over £50,000 of gross income in April 2026, drops to £30,000 in April 2027 and £20,000 in April 2028. What counts as qualifying income, the quarterly updates, penalties and how to get ready.
Published 9 September 2026 · 3 min read · By AIRPROP
Making Tax Digital for Income Tax replaces the annual self-assessment return with quarterly digital updates and a final declaration, all submitted through HMRC-compatible software. It is now live for the first group of landlords and expands over the next two years.
Who is affected and when
The test is your gross qualifying income: rent from UK and overseas property plus self-employment turnover, before any expenses, based on the tax return two years earlier.
| From | Qualifying income above |
|---|---|
| 6 April 2026 | £50,000 |
| 6 April 2027 | £30,000 |
| 6 April 2028 | £20,000 |
Employment income, pensions, dividends and interest do not count towards the threshold. Jointly owned property counts at your share. Property held in a limited company is outside MTD for Income Tax altogether, because companies file under corporation tax.
A landlord with £2,100 a month of rent across two properties has £25,200 of qualifying income and joins in April 2028. A landlord with an HMO producing £4,500 a month has been in since April 2026.
What you have to submit
- Quarterly updates of income and expenses for the standard quarters to 5 July, 5 October, 5 January and 5 April, each due by the 7th of the following month. Updates are cumulative, so a mistake in one quarter is corrected in the next.
- A final declaration by 31 January after the tax year, confirming the figures, adding other income and reliefs, and replacing the old return.
- Records must be kept digitally and the submissions must come from compatible software or a bridging tool linked to a spreadsheet.
Tax is still paid on the same dates as now: 31 January and 31 July payments on account, with the balance on 31 January.
Penalties
A points-based system applies to late quarterly updates: a point for each missed deadline and a £200 penalty once the points threshold is reached, with a further £200 for each subsequent miss. Late payment interest and penalties follow the existing self-assessment rules. HMRC has indicated a lighter touch for the first year of each cohort, but the deadlines are the deadlines.
Getting ready
- Work out your qualifying income from your most recent return and note your start date.
- Choose software. Dedicated landlord tools, general accounting packages and spreadsheet bridging products all work; the right choice depends on how many properties you have and whether an accountant will be submitting for you.
- Separate your property banking from personal spending. Mixed accounts are the main cause of quarterly chaos.
- Decide who submits: you, your accountant, or an automated process that classifies your bank feed and prepares each update for a two-minute review.
- Sign up with HMRC before your first quarter, and authorise your agent if you use one.
Where AI helps
Quarterly updates are exactly the kind of repetitive, rules-based work that automation handles well. AIRPROP's own bookkeeping classifies every transaction as it arrives, matches receipts and produces the quarterly figures without a scramble at the deadline, and we build the same for clients. If your quarter currently ends in a shoebox, this is the year to fix it.
This guide is general information. Confirm your own start date and obligations with HMRC or your accountant.
This guide is general information for landlords and investors in England, correct to the best of our knowledge at the date shown. It is not legal, tax or financial advice. Rules change and individual circumstances differ, so take professional advice before acting.
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