MTD for Landlords 2026: Complete Guide to Making Tax Digital
MTD compliance guide for UK landlords. Deadlines, software requirements, and how to prepare for quarterly submissions starting April 2026.
Key Takeaways
- MTD is mandatory from April 2026 for landlords earning >£50k gross
- You’ll submit quarterly updates (not just an annual return)
- You need MTD-compatible software—spreadsheets won’t work
- First-year penalty points are waived, but don’t wait to prepare
If you’re a UK landlord with rental income, Making Tax Digital (MTD) is coming for you. Over 780,000 landlords will need to comply starting April 2026, with more joining in 2027 and 2028.
What is Making Tax Digital?
Making Tax Digital is HMRC’s initiative to modernise the UK tax system. Instead of filing an annual Self Assessment tax return, you’ll need to:
- Keep digital records of all income and expenses
- Submit quarterly updates to HMRC (cumulative year-to-date figures)
- File a final declaration at the end of each tax year
Do I Need MTD as a Landlord?
The rollout is phased based on your gross rental income (before expenses):
| Deadline | Who’s Affected |
|---|---|
| April 2026 | Landlords with gross income over £50,000 |
| April 2027 | Landlords with gross income over £30,000 |
| April 2028 | Landlords with gross income over £20,000 |
Quarterly Submission Deadlines
Once MTD applies to you, you’ll need to submit quarterly updates:
| Quarter | Period | Deadline |
|---|---|---|
| Q1 | 6 April – 5 July | 7 August |
| Q2 | 6 July – 5 October | 7 November |
| Q3 | 6 October – 5 January | 7 February |
| Q4 | 6 January – 5 April | 7 May |
Your final declaration is due by 31 January following the end of the tax year.
What Records Must You Keep?
Under MTD, you must maintain digital records of:
- Rental income from each property
- Allowable expenses categorised correctly (repairs, insurance, agent fees, etc.)
- Receipts and invoices linked to transactions
- Property details including ownership percentages for jointly-owned properties
Paper records and spreadsheets won’t meet the digital requirements—you’ll need MTD-compatible software.
What Software Do I Need for MTD?
HMRC requires you to use “functional compatible software” that can:
- Store digital records of income and expenses
- Submit quarterly updates via the MTD API
- Receive information from HMRC (like tax calculations)
Generic accounting software like Xero or QuickBooks offers MTD modules, but they’re designed for businesses—not landlords. Property-specific features like mortgage interest restrictions, per-property tracking, and SA105 alignment are often missing.
Purpose-built landlord software like Portiqo handles the nuances of property income, including Section 24 mortgage interest restrictions and HMRC expense categories. For a detailed breakdown, see our Landlord Allowable Expenses Guide.
How Much Does MTD Cost?
The cost of MTD compliance depends on your approach:
| Option | Typical Cost | Best For |
|---|---|---|
| Accountant handles it | £500–1,500+/year | Hands-off landlords, complex portfolios |
| Generic accounting software | £10–30/month | Landlords with business accounting needs |
| Landlord-specific software | £5–15/month | Most residential landlords |
| Free HMRC software | £0 | Very basic needs (limited functionality) |
The real cost isn’t the software—it’s the time spent categorising expenses correctly and meeting quarterly deadlines. Choose software that reduces this burden.
Penalties for Non-Compliance
HMRC has introduced a points-based penalty system:
- 1 point for each missed quarterly deadline
- 2 points for a missed final declaration
- £200 penalty when you reach 4 points (quarterly) or 2 points (annual)
There’s a grace period for the first year (April 2026 cohort), where penalty points won’t be applied for late quarterly updates. However, final declaration penalties still apply.
How to Prepare
- Assess your income – Check if your gross rental income exceeds the threshold
- Choose MTD software – Select a solution that handles property income specifically
- Digitise your records – Start keeping digital records now
- Connect to HMRC – Link your software to your Government Gateway account
- Practice quarterly reporting – Get into the habit of regular record-keeping
Get MTD-Ready Now
The April 2026 deadline is just months away. Portiqo is purpose-built for UK landlords facing MTD compliance:
- HMRC-aligned categories – No guesswork on expense classification
- Automatic cumulative totals – Quarterly submissions calculated for you
- Digital receipt storage – 6-year audit trail, sorted
- Direct HMRC submission – Submit via MTD API without leaving the app
- Section 24 handled – Mortgage interest restrictions calculated automatically
Join 500+ landlords already preparing for MTD.
Related: Landlord Allowable Expenses Guide · Section 24 Explained