What is Making Tax Digital for Income Tax?
Making Tax Digital for Income Tax (often shortened to MTD for ITSA) changes how landlords and self-employed people report income to HMRC. Instead of one Self Assessment return a year, you keep digital records of income and expenses throughout the year and send HMRC a quarterly update through compatible software, followed by a final year-end declaration.
It doesn't change how much tax you owe — it changes how and when you report it, and it removes paper and spreadsheet-only record-keeping for anyone in scope.
Who's affected, and when
MTD for Income Tax applies once your combined gross income from self-employment and property — before expenses — is above the threshold for the relevant tax year:
| From | Qualifying income threshold |
|---|---|
| 6 April 2026 | Over £50,000 |
| 6 April 2027 | Over £30,000 |
| 6 April 2028 (announced) | Over £20,000 |
Thresholds and dates are set by HMRC and can be revised — check GOV.UK's Making Tax Digital guidance for the confirmed position for the current tax year, particularly if you're close to a threshold.
The income test looks at your gross income across property and self-employment combined, not net profit — so a landlord with several properties can be in scope even if their actual rental profit after costs is much lower.
What you actually have to do
- Keep digital records of rental income and expenses as you go, rather than reconstructing them once a year
- Send a quarterly update to HMRC through MTD-compatible software for each property business
- Submit a final declaration after the tax year end, replacing the old Self Assessment return for those in scope
How to prepare
Before your first quarterly update is due
- Work out your gross income across all property and self-employment sources to check whether you're already over the threshold
- Move rent and expense record-keeping into MTD-compatible software rather than a shoebox of receipts
- Record expenses per property as they happen, not in a end-of-year batch
- Send quarterly updates by 7 August, 7 November, 7 February and 7 May, and make your final declaration by 31 January after the end of the tax year
- There are no penalty points for late quarterly updates in the 2026/27 tax year. From 6 April 2027, each missed update earns a point, and 4 points lead to a £200 penalty
- Talk to your accountant about which software suits you
LandlordHub's free Landlord Tax Calculator gives a quick estimate of your buy-to-let tax position, and LandlordHub's Expenses & tax page keeps each property's costs and receipts under HMRC's headings and lets you download them for your MTD software. LandlordHub doesn't track rent or submit to HMRC, so you'll still need MTD-compatible software for your quarterly updates.
Frequently asked questions
What is Making Tax Digital for landlords?
Making Tax Digital for Income Tax (MTD for ITSA) requires landlords and self-employed people above the qualifying income threshold to keep digital records of income and expenses and send quarterly updates to HMRC using compatible software, instead of filing a single annual Self Assessment return.
When did Making Tax Digital start for landlords?
Making Tax Digital for Income Tax went live on 6 April 2026 for landlords and sole traders with qualifying gross income over £50,000. HMRC has set out further threshold reductions in later years, bringing more landlords into scope over time — check GOV.UK for the current thresholds and dates.
Do I have to use MTD if I'm below the threshold?
Not yet, but the qualifying income threshold is scheduled to fall in stages, so more landlords will be brought into MTD for Income Tax over the next few years even if they're not affected today.
What counts towards the income threshold?
HMRC looks at your combined gross income from self-employment and property before expenses, not just rental profit. Landlords with several income sources should check their total against the threshold, not just their rental income alone.
What software do I need?
You need HMRC-recognised MTD-compatible software to keep digital records and submit quarterly updates. Spreadsheets can work if paired with bridging software, but a dedicated system that records income and expenses per property removes most of the manual work.